What’s in the New DC Comprehensive Housing Strategy … and Not?

The Coalition for Nonprofit Housing and Economic Development devoted its latest monthly meeting to the comprehensive housing strategy produced by the task force Mayor Gray appointed in 2012.

I’ve waited to write about it until I could hear from some of the lead task force members because the report is hard to digest. And much of it isn’t written for the likes of thee and me.

It’s clearly of, by and for housing developers, though the interests of some of constituencies represented on the task force are wedged in as well. Not, however, the interests of the District’s lowest-income residents.

The strategy establishes three big goals for the next eight years:

• Preserve the 8,000 or so affordable units with subsidies that are due to expire.
• Produce and preserve 10,000 net affordable housing units, i.e., increase the stock by this number.
• Support the development of 3,000 market-rate units a year.

The market-rate units — 24,000 in all, if I’ve got the timeframe right — are in the plan because the task force fears that the District could wind up with housing affordable only for the wealthy and the poor who’ve got subsidies.

But whom the preserved and/or produced affordable housing units would be for isn’t specified.

The task force recommends that “the lions share of new funds” (emphasis added) be used to finance housing for households at or below 60% of AMI (the median income for the D.C. area).

Based on the 2012 figures the task force used, that would mean housing for those with incomes no higher than $64,500.

Yet more than one in five D.C. households had incomes at or below half of that, putting them in the category housing experts call extremely low-income.

The task force dutifully notes the more than 67,000 of these households on the housing assistance waiting list and the nearly 7,000 people who were literally homeless in January 2012.

Also a recent estimate that the District would need about 2,700 permanent supportive housing units to end homelessness for chronically homeless residents. (Sorry folks, no online document.)*

Yet I looked in vain for a target for extremely-low income residents as a whole — a specific number of affordable units, for example, or some portion of whatever the total dollar investments will be.

These are residents who, if not homeless now, are at high risk. Nearly two-thirds of them paid more than half their income for rent in 2010 — a far greater portion than households in any of the higher income tiers.

On a positive note, the task force recommends:

• A new, more reliable revenue stream for the Housing Production Trust Fund, which now suffers whenever the local real estate market does.
• That the Trust Fund no longer be tapped to cover the costs of locally-funded housing vouchers, as it has been for the last two years.
• A new fund to finance “shovel ready” affordable housing projects. What it could do that existing programs couldn’t, if adequately funded, isn’t explained.
• An increase in rent and operating subsidies — and use of all the subsidies. No more administrative directives that the DC Housing Authority hold on to fully-funded vouchers.
• That DCHA develop additional public housing, exercising the authority it has under its contract with the U.S. Department of Housing and Urban Development.

Some of these initiatives would clearly benefit the District’s poor and near-poor residents. How much would depend on what the District is prepared to spend — and how the total would be divvied up.

We’ve got more than enough experience to know that a developer can promise affordable housing without doing much, if anything, for extremely low-income households — and get financial help from the District.

And more than enough experience to know that goals and action plans don’t drive budget and other policy decisions unless elected officials view the potential results as priorities.

So the task force wisely recommends a standing Housing Investment Council to implement the strategy and report on results every two years.

The Council will have a lot of work to do. Many recommendations in the report aren’t “shovel ready” — partly because data the task force needed weren’t available and partly because “it was hard enough to get agreement on concepts,” according to CNHED Executive Director Bob Pohlman.

I’d hoped for a report that provided clearer benchmarks for what the many proposed benefits to developers would achieve.

But it does represent a serious effort — and a serious commitment to get those responsible to follow through. We see this in the detailed action items and timeframes that constitute nearly half.

Finally, however, it’s the Mayor and the DC Council who’ll have to commit ongoing resources to translating the recommendations into realities.

And clearly, we who care about affordable housing will have to commit to ongoing advocacy — especially, I think, for the most vulnerable District residents.

* The report references the five-year strategic plan issued by the Interagency Council on Homelessness. This plan, however, reiterates the District’s earlier commitment to at least 2,500 PSH units. So I assume the task force had access to some other document.

DC Rents Way Out of Reach for Low-Income Households

We’ll learn next week what Mayor Gray plans to do about the affordable housing shortage in the District of Columbia.

We know he’s promised a one-time $100 million investment, but we’ll need his budget proposals to learn where the money would go — and if that’s all he’ll commit to.

The latest annual rental housing (un)affordability report from the National Low Income Housing Coalition provides a useful set of figures indicating needs in the District, as well as in each state and the nation as a whole.

If they don’t create a sense of urgency, I don’t know what will.

As I explained last year, NLIHC uses several set of figures — most of them drawn from federal sources — to arrive at what it calls a housing wage. This is the amount a renter would have to earn to afford a modest two-bedroom apartment, plus basic utilities in each jurisdiction.

The cost of the apartment is the U.S. Housing and Urban Development’s fair market rent estimate. The standard for affordability is the usual 30% of gross income.

NLIHC also does some calculations based on the applicable minimum wage — $8.25 in the District — and the average wage of renters in each jurisdiction.

Not surprisingly, the two-bedroom apartment is way out of reach for low-wage workers in the District — considerably further out of reach than for low-wage workers nationwide.

The same is apparently true for many other D.C. renters, since their average wage falls shorter as well.

Here first are the big picture numbers.

• A household would have to have earnings totaling $4,707 a month — $56,480 a year — to afford the two-bedroom apartment in the District.
• Assuming full-time, year round work, this translates into a housing wage of $27.15 an hour — a higher housing wage than for any state except Hawaii, though somewhat lower than for any of the top 10 metro areas, according to dcist .
• The average renter wage here is $102 less per month than what would make the apartment affordable — an annual shortfall of $1,224.

And now the truly bad news figures for low-income District residents.

• The two-bedroom apartment costs $607 a month more than would be affordable for an extremely low-income household, i.e., one whose income is at or below 30% of the median for the area.*
• The apartment costs $983 a month more than a full-time minimum wage worker can afford.
• So s/he would have to work 132 hours a week, every week to afford it — or live with three other full-time minimum wage workers and another working part-time.
• This is 28 hours a week more than what NLIHC calculates for minimum wage workers nationwide, though it uses the lower federal minimum for them.
• For residents who depend on Supplemental Security Income, the apartment costs a mind-blowing $1,199 more than would be affordable.

The story in the District is in many ways like the story NLIHC tells for the nation as a whole. The number of renter households has increased. Vacant apartments are scarce, creating the usual supply-demand pressure on costs.

But the supply side is also affected by the upscaling of once-affordable rental housing — and the fact that most new construction is also for fairly well-off households that, at least for now, prefer renting to owning.

This is how the free market works. It’s why we need public investments to create and preserve housing that’s affordable for low-income households.

And why we need vouchers that will enable others to live in market-rate units without spending more than half their income for rent, as nearly two-thirds of extremely low-income households in the District do.

The District has the revenues to make living in this high-cost city affordable for residents who haven’t shared in the prosperity those revenues indicate — that’s in fact made rents even less affordable for them.

It will have to choose to make ongoing commitments — and to target a very significant portion to its lowest-income residents who are homeless now or at high risk because they really can’t afford the rent they’re paying.

The Mayor says he’s worried that his One City will become “a city of only ‘haves’.” Let’s see what he does to make it more genuinely “inclusive” of the have-nots.

* According to the estimate NLIHC uses, this would be a maximum of $32,190.

Reading the Fair Budget Coalition’s New Report

The Fair Budget Coalition released its eighth annual report last week. As in the past, the Coalition recommends specific funding and other policy priorities for the District of Columbia’s next annual budget.

There are 33 recommendations in all — nearly half of them related to housing. The remainder address jobs, health, safety and revenues.

No way I can cover so many and diverse recommendations in a post. And at this point, I don’t want to pick and choose.

So let me instead share some thoughts I had as a read the report.

Growing income inequality is one of the District’s biggest challenges.

The District’s poverty rate remains considerably higher than the rate before the recession set in. And that was pretty high.

But the overall rate — 18.7% — is an inadequate measure of the challenges our policymakers face if, as Fair Budget proposes, they choose to “advance dignity and equity for all.”

For one thing, the poverty rate masks huge disparities. The poverty rate for black residents, for example, is more than four times the rate for those classified as white/non-Hispanic.

Not coincidentally, the poverty rate for the Census Bureau’s “micro area” that’s mostly Wards 7 and 8 is 34.3%, as compared to 9.6% in the area that’s mostly upper Northwest.

As I’ve written before — probably too many times — the official poverty rates are based on an outdated, over-simple measure. So they egregiously fail to reflect the hardships low-income people struggle with, especially in a high-cost city like D.C.

Consider, for example, that the median income for all the District’s black households was only $39,302 last year — about $19, 140 less than what would make a modest two-bedroom apartment affordable.

Meanwhile, the wealthiest households were doing very well indeed. In 2009, the top 5% had incomes averaging $436,900 — 25.7 times greater than the average for households in the bottom fifth.

The District has done more to address the hardships of low-income people than most jurisdictions.

We see this very clearly in the recommendations themselves.

One set, for example, calls for targeted expansions of the Local Rent Supplement Program — a housing voucher program the District established to supplement the woefully under-funded federal equivalent. Only four states have voucher programs like this.

Another recommendation asks for continuing adequate investments in the DC Healthcare Alliance — a program the District created to provide affordable health care to residents barred from Medicaid under federal rules.

For perspective on this, look at the states that won’t expand their Medicaid programs now, even though the federal government would pick up all the initial costs — and all but 10% for the long term.

Recent budgets have short-changed programs that serve low-income residents’ needs.

Like state and local governments across the country, the District had to cope with revenue losses due to the recession. And, like most, it decided to cope mainly by cutting spending rather than raising more money through tax policy changes.

So some safety net programs, e.g., homeless services, didn’t expand as they should have to meet increased recession-related needs. Others that could have helped low-income residents support themselves and their families were actually cut.

As I’ve written (and written), the District decided to start phasing out benefits for families who’d participated in the Temporary Assistance for Needy Families program for a lifetime total of more than five years — even though officials knew the program had failed them.

Also knew that even well-trained people with substantial work experience were having a hard time finding employment unless they had at least a bachelor’s degree.

Meanwhile, the budget for child care subsidies was cut by a total of $30 million, making it difficult for low-income parents, especially those with infants and toddlers, to manage full-time jobs.

Funding for adult education was also cut, significantly limiting opportunities for the very large number of working-age residents who are functionally illiterate and others who aren’t, but lack a high school diploma or the equivalent.

The District now has an opportunity to rebuild and expand.

The District weathered the recession much better than many jurisdictions. And its economy has bounced back nicely.

Even the super-conservative Chief Financial Officer now projects $190 million more in revenues for the current fiscal year and nearly $178 million more for the upcoming fiscal year, when he (and everyone else) expects the District to experience greater impacts from the across-the-board cuts in federal spending.

The Mayor and the DC Council will still have to make choices. That’s what budgeting is about.

But they can, if they choose, invest more in programs that will alleviate the hardships of the have-nots and support their aspirations to share the opportunities and decent standard of living that many of us take for granted.

And I believe a large majority of the community would support this.

Those who do need to let the Mayor know ASAP. Fair Budget has an editable e-mail we can use.

Panel to Address Poverty in DC and What to Do About It

On Tuesday, March 5, the Fair Budget Coalition will host a panel discussion on poverty in the District of Columbia — “The State of the District’s Poverty: What’s the Story Behind the 600 Kids at DC General?”.

As the online invitation suggests, the Coalition is linking the record-high number of children in DC General — the District’s main shelter for families — to funding cuts in both safety net programs and others that benefit low-income residents.

A look at the District’s poverty rates is surely worthwhile. As I’ve written before, both the overall rate and the child poverty rate are well above the national rates — and considerably higher than the rates in 2007, just before the recession set in.

But, as I’ve also written, the Census Bureau’s poverty thresholds are unrealistically low. For a single mother with two children, for example, the 2011 threshold was just $18,123.

The Wider Opportunities for Women’s Basic Economic Security Tables for the District show that the family would need about $85,680 for basic necessities, child care and taxes, plus some extra for rainy day and retirement savings – if the mother had employer-sponsored health insurance and retirement benefits.

This is higher than the 2011 median income for District households as a whole, but nearly $22,000 lower than the median for households classified as white/non-Hispanic.

One of many indications that the growing economic prosperity Mayor Gray’s recent State of the District address celebrated hasn’t done much for the “have-nots” in the city.

The challenge Fair Budget faces is that no panel can specifically address all the programs that could alleviate hardship — and narrow the huge income gaps here — if the Mayor and the DC Council invested more money in them.

The event can provide a framework for the programs, however, and draw some links among them. Also identify priorities for addressing critical weaknesses.

We know, for example, that the Temporary Assistance for Needy Families program aims to prepare parents for work that will, at the very least, reduce their need for safety net benefits.

The District has invested resources in making TANF job training more effective. It’s also launched several initiatives to match job seekers with employers that might hire them.

But many parents won’t be able to work unless they have child care — and a subsidy to make it affordable. Consider, for example, that the average annual market rate local centers charge for infants is $2,400 more than a full-time minimum wage worker earns.

Yet the District’s subsidy program reimburses providers at such low rates that many have gone out of business. The remainder perforce generally limit the number of subsidized children they’ll take.

So there are more than 9,000 infants and toddlers on center waiting lists, according to the Fair Budget invite.

We’ve thus got one program that’s doing more to address barriers to work and another that should, but isn’t because it’s egregiously under-funded.

Similarly, the employment prospects of more than 36% of D.C. adults are extremely limited because they’re functionally illiterate.

Yet local funding for adult education programs was cut in Fiscal Year 2011 and again in Fiscal Year 2012. It’s at its twice-reduced level in the current budget, I’m told. (The budget for the Office of the State Superintendent of Education, where adult ed. is housed, is notoriously opaque.)

Well, I could go on, but point is made, I hope. As with any complex problem, poverty has a lot of inter-related parts. And the District government has a lot of parts that affect it, for good or ill.

If the Mayor truly wants to “improve the quality of life for all,” as his One City Action Plan says, then he should fashion a budget that reflects a comprehensive commitment to both the safety net and poverty reduction.

Like all elected officials, he’ll tend to want what he believes his constituents want seriously enough to consider when election time rolls round.

So a good turnout at the Fair Budget Coalition’s event would send a helpful message. And I expect it to be both informative and a launching pad for this year’s grassroots budget advocacy.

And who wouldn’t be inspired to launch after listening to panelists who know poverty first-hand — and while sitting among some of the families from DC General who’ll be there too?

The hour-long event begins at 3:30 p.m. in Room 412 of the Wilson Building, 1350 Pennsylvania Avenue, NW. You’ll need a photo ID to get past the guards.

And Fair Budget asks that you RSVP to Janelle Treibitz, 202-328-5513 or janelle@fairbudget.org.

UPDATE: The event will be in Room 123 instead of Room 412, as originally planned.