More than 19 million households across the country are cost-burdened, and 11 million of those are spending more than 50% of their income on housing, according to Freddie Mac.
— From an October 4, 2018 article in HousingWire.com
Earlier this month, the Federal Home Loan Mortage Corporation, better known as Freddie Mac, announced its re-entry into the LIHTC market, with an investment of $100 million. The Low Income Housing Tax Credit program (LIHTC) helps fund housing for people living near or below the poverty line. Here in Colorado, the LIHTC program is administered by the Colorado Housing Finance Authority (CHFA).
To put $100 million into perspective, that amounts to less than $10 for each American household currently spending more than 50% of their income on housing. The proposed budget for the Archuleta County government, next year, is $33 million.
$100 million for housing. That’s not even a bad joke.
I see this as yet another indication that our federal government has almost no interest in addressing the housing crisis taking place in so many American communities.
Yesterday, the Archuleta Board of County Commissioners stepped up to the plate, to help address the crisis here in Pagosa Springs. In a unanimous vote, the BOCC agreed to offer 2.5 acres of vacant County-owned property to the Archuleta County Housing Authority (ACHA), in a 99-year lease, for $1 a year. ACHA hopes to one day build a LIHTC project on the parcel.
As we saw in Part One, that vacant 4.9-acre parcel on Hot Springs has seen a few proposal since the Archuleta County government purchased it for $750,000 in 1999. The plan, in 1999, was that a new County Administration building would be constructed there — someday — conveniently located right across the street from Town Hall. The building would not include a Detention Center, because the sellers — Fairway Land Trust — obtained an agreement from the County that no law enforcement facilities would be sited in that location.
The County tried to sell the parcel during its near-bankruptcy financial crisis in 2007 and 2008, but the Town Council refused to cooperate and stubbornly maintained the parcel zoning as “government use.”
We talked about the 2011 ‘Pavilion at Pagosa Springs’ lease controversy yesterday — an idea that was aborted without a chance for BOCC approval — and we also talked about the aborted attempt in 2016 by two County Commissioners to locate a new ‘justice center’ on the parcel, in violation of the purchase agreement with Fairway Land Trust.
The latest idea for making useful use of this 4.9-acre parcel had come to the Board of County Commissioners from the Archuleta County Housing Authority. You can download the ACHA agenda item here.
People get ideas, and sometimes the ideas pan out, and sometimes they don’t. (I’m speaking from personal experience.) It sometimes seems like the ‘bigger’ the idea, the less chance it has of actually happening.
The idea coming from ACHA could probably be viewed as ‘medium sized.’ ACHA currently operates a 16-unit senior housing project on South 8th Street, and does a decent job, according to the reports I’ve heard. Their proposed LIHTC apartment project for Hot Springs Boulevard would provide perhaps 40 units of affordable rental housing — mainly for residents near or below the poverty line, although some of the units might be priced at market rates. In the BOCC agenda packet, the report from ACHA suggested rental rates ranging from $472 per month to $1212 per month.
ACHA hopes to submit an application to CHFA in 2019, if all goes well. But ACHA representative Jim Garrett noted that a submitted application doesn’t guarantee CHFA funding, which is highly competitive. Often, an agency will submit two or three times before receiving LIHTC approval. And once funding is approved, it’s typically another year before the agency can break ground — and another year to complete the construction.
This suggests that an affordable housing project on Hot Springs Boulevard is at least three years away, and possibly five or six years.
About ten years ago, a non-profit company from California purchased a 5-acre hillside property overlooking North 6th Street and began work on a LIHTC apartment project there: the 40-unit Hickory Ridge Apartments.
The project received fee waivers from the Town of Pagosa Springs, but I was told the California company that started the project ultimately went bankrupt before the project was completed. The project is currently owned by ’49 Hickory Ridge Apartments Limited Partnership.’ The County Assessor website shows the property valued at about $2.2 million.
According to my pocket calculator, that puts the value at $55,000 per apartment unit. Considering that a typical new, single-family home in Archuleta County often costs more than $500,000, maybe we were blessed with something halfway affordable. But of course, that was ten years ago.
During the BOCC discussion about the ACHA request, the public was invited to comment on the 99-year lease and the Hot Springs Boulevard location. One person stood up and protested the location of the proposed project, suggesting that low income families don’t belong on Hot Springs Boulevard. That person was former County Commissioner Bob Moomaw.
As you might recall from Part One, Mr. Moomaw — while still serving as commissioner — had secretly arranged for a lease of this same vacant parcel, to be offered at $1 a year to a non-profit organization headed by his wife, Janis Moomaw. That proposed lease met with considerable public protest when it finally saw the light of day, and was never approved by the BOCC.
The proposed lease to ACHA, meanwhile, has been an open and transparent process. The way things ought to be.
The nationally-recognized definition for a ‘cost burdened’ family is ‘more than 30 percent of family income spent on housing.’ Earlier this month, we shared some survey data collected and analyzed by the Pagosa Housing Partners, and I suggested that — if the survey data were indeed representative of the whole community — then we have about 3,400 ‘cost burdened’ households in our community.
The 2017 Housing Needs Study reported a total of 6,200 resident households in Archuleta County.
I fully support the creation of 40 affordable apartment units on Hot Springs Boulevard, within the next 5 years or so. That seems like a very, very small step in the right direction.