Ballots for Buildings: Voters Weigh Affordable Housing Measures

By: - November 6, 2018 12:00 am

Supporters of Proposition 10, in favor of rent control and building more affordable housing, listen to labor and civic leaders at a news conference in Sacramento, California. Voters in eight states will decide on affordable housing measures this Election Day. Steve Yeater/The Associated Press

This story is part of Stateline’s midterm election coverage.

Amid a rapid rise in housing costs in many parts of the country, voters in eight states will consider measures today that would either spur the construction of more housing or enact new protections for tenants.

The relatively large number of housing-related measures on the ballot this year reflects the seriousness of the problem, a lack of federal action and tight city and state budgets, some longtime housing activists say.

“I’ve never seen anything like it,” said Nick Fish, a Portland, Oregon, city commissioner and former vice chairman of the city’s housing authority. Portland voters will decide on local and state affordable housing measures. “The public wants to see action,” Fish said. “There’s a growing sense of urgency.”

Nationwide, housing is at its least affordable in more than a decade, based on the percentage of income needed to buy a median-priced home, according to a June report by ATTOM Data Solutions, which tracks real estate data. A 2017 analysis by the Harvard Joint Center for Housing Studies found that nearly half of renters were cost-burdened, spending more than 30 percent of their income on rent.

Thanks to high construction costs, a shortage of private low-cost housing and restrictive zoning laws, more people are competing for an increasingly limited share of rental housing.

There’s a shortage of 7 million affordable and available rental homes for low-income renters, according to a March study by the National Low Income Housing Coalition. For every 100 extremely low-income households, there are just 35 affordable rental units; 71 percent of these households spend more than half of their income on rent, with little left over for food, utilities and transportation, the report found.

Working, middle-class professionals also struggle, housing analysts say. Incomes haven’t kept pace with the economy’s growth over the past 30 years, according to a 2018 report by the Joint Center for Housing Studies at Harvard.

Not enough housing is being built to keep up with demand, said Priya Jayachandran, president of the National Housing Trust, a Washington, D.C.-based housing preservation nonprofit.

“We have a real supply problem,” Jayachandran said. “We’re not keeping pace with population increases. Prices go up.”

Federal funding for affordable housing has been cut as well. Between 2010 and 2017, Congress cut annual Housing and Urban Development program funding by 9 percent, or .2 billion. Public housing was hardest hit by budget cuts, particularly for repairs and operating costs. Funding for programs that subsidize affordable housing construction was slashed, too.

And at the same time, state and local budgets are strapped, said Mary Cunningham, vice president for metropolitan housing and communities policy for the Urban Institute. Visible homelessness is up, she said, as housing prices skyrocket and gentrification pushes long-term residents out of their homes.

“You’ve got this very visible manifestation of the affordable housing crisis,” Cunningham said. “People don’t want to see homeless people living on the street, struggling.”

The lack of affordable housing has been a growing problem since the 1970s, said Katherine O’Regan, professor of public policy and planning at New York University’s Wagner School of Public Service. But the problem has intensified, she said.

One way to measure the scope of the affordable housing crunch is by looking at residual income, what you have left after you’ve paid your rent and transit. Residual income has declined over the past 30 years, making the housing crisis direr, she said. That’s because median housing costs have increased at a much greater rate than median wages, she said.

“We are at a new point in the interest in addressing the affordability crisis,” O’Regan said. “One thing that’s happened is this isn’t a poor person’s problem anymore.”

Billions on the Ballot

In California, voters will decide on three affordable housing ballot measures.

Proposition 1, also known as the Veterans and Affordable Housing Act, would allow the state to sell billion in general obligation bonds to fund existing affordable housing programs for low-income people, veterans and farmworkers. If passed, most of the funds — billion — will go toward existing affordable housing programs and billion would go to veteran housing programs.

The measure was introduced as a state bill in the California Senate and Democratic Gov. Jerry Brown signed it last year. The constitution requires that voters approve general obligation bonds of more than ,000.

Meanwhile, the state’s Proposition 2 would authorize billion in previously appropriated funding to go toward building housing for the chronically homeless and people with disabilities or mental illness.

Cuts in federal and state funding reduced California’s annual investment in affordable housing by more than .7 billion since 2008, a 66 percent reduction, according to a 2016 study by the California Housing Partnership. The homeless population rose by 14 percent.

By 2016, there was a momentum building around the state to put housing funding on the ballot among both advocates and legislators, said Nur Kausar, the spokeswoman for Housing California, an advocacy group behind the campaign to get Propositions 1 and 2 on the ballot.

“The idea was to put money into solutions that we know work,” Kausar said.

More hotly debated is Proposition 10, also known as the Local Rent Control Initiative Act , which would expand rent control, giving California cities and counties the ability to use it as they see fit.

It would do this by repealing a 1995 state law that restricts rent control on some housing units and allows landlords to increase rent to market rates when a tenant moves out. Proposition 10 is the subject of intense controversy, with opponents and proponents spending nearly million combined in the campaign.

The housing industry has vehemently opposed it, as have the Republican and Democratic nominees for governor.

“There’s a desperation to do something about our affordable housing measures in California,” said Steven Maviglio, spokesman for Californians for Responsible Housing, which opposes the measure.

Rent control is seen as a “silver bullet” to fix the housing crisis, but it only makes it worse, because it reduces housing stock, Maviglio said.

Financing Affordable Housing

In Oregon, voters will decide whether to amend the state constitution to ease the way for cities and counties to borrow money for affordable housing projects. Measure 102, which has bipartisan support in the legislature, would remove the restriction that any affordable housing project built in the state and funded by municipal bonds be government-owned.

If it passes, more affordable housing could be built using public-private partnerships, said Fish, the Portland city commissioner, who is campaigning for the measure.

Meanwhile, voters in the Portland metro area will also weigh a companion measure, which would allocate million for acquiring, constructing and renovating affordable housing in the region. If the statewide measure passes, Fish said it would be the largest affordable housing bond in state history.

Around the country, most of the affordable housing measures rely on bonds and targeted tax increases to fund affordable housing.

“There’s more of a willingness to say, ‘We want to support tax levies that will go to solve this problem,’” the Urban Institute’s Cunningham said.

A proposed levy in Bellingham, Washington, a suburb of Seattle, would fund the production and preservation of homes, rental assistance, support services and down payment help for low-income homebuyers.

Two ballot measures in Telluride, Colorado, would increase levies on property and sales taxes to fund and finance affordable housing. A third measure would increase the town debt to fund affordable housing and use the property tax revenue to pay off that debt. In Charlotte, North Carolina, voters will decide whether to increase the city’s affordable housing trust fund from million to million.

In a handful of cities, including Chicago and Berkeley, California, ballot measures would expand tenant protections, such as rent control.

And cities in Arizona and Texas have ballot initiatives to make it easier to pay for affordable housing in a crunched market. Voters in Flagstaff, Arizona, will weigh whether to allow the city council to fund million in general obligation bonds to finance affordable housing. In Austin, voters will decide whether to allocate million to million for affordable rental housing, homeownership programs, home repairs and land acquisition.

Ultimately, ballot measures are just one way to address the housing crisis, O’Regan said. But it shouldn’t be the only way, she said.

“You can’t pick up one tool and think that’s going to move the needle on the overarching problem,” O’Regan said.

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Teresa Wiltz

Teresa Wiltz covers welfare, housing and social services for Stateline. Previously, she worked for the Washington Post and the Chicago Tribune.