Affordable housing is difficult in Denver, but not impossible
Ahome is a sanctuary that plays a pivotal role in helping design and define who both we and the bigger community we live in are. It provides the space where life defining experience, feelings, education, relationships, love, perspectives and values are crafted. Having a safe, affordable and predictable home is a basic need and necessity all of us have. And yet, not all of us have the opportunity.
Today Denver is practically at full employment and experiencing an economic boom. Yet it is experiencing a gap in affordable housing, unprecedented in its history. There is a price being paid for that. To find affordable homes, families are traveling four to 10 miles out of city, doubling up, paying more than 40 percent of their income for housing, and in general living under growing stresses that affect the health and well-being of adults and children. This costs all society at a much higher rate than what we would have to invest in making it possible to provide affordable housing.
As a community we need to recognize the disparity between what the marketplace provides on one hand and takes away with the other. The marketplace provides for-rent and for-sale housing units and prices it bases on free market principles (demand and supply). But if the marketplace is providing income that cannot afford to pay for the market rate pricing — it is taking away opportunity.
I have been working for over 30 years to redress this imbalance. It’s not easy, but also not impossible.
Northeast Housing Center recently completed 84 affordable rental units in Stapleton with a total cost of $18,983,309 or $225,992 per unit. It took three years and four different competitive applications to package the financing and get the project built. We had to weave a tapestry of nine different funding sources each with its own rules and regulations. A private lender — First Bank covered 32 percent of the financing. The rest came from: the City of Denver, 4 percent; State of Colorado Division of Housing, 4 percent; Forest City (private developer of Stapleton), 8 percent; Federal Low Income Housing Tax Credit, 28 percent; State Low Income Housing Tax Credit, 14 percent; and the developer Northeast Denver Housing Center, 5 percent. The remaining 5 percent came from collaborative funding of the City of Denver, state of Colorado, CHFA and private sources.
Who got served? As the 84 units were being built, households were inquiring and putting their name on an “interest list”. When the units were ready, the property management company went through the list and within a month and a half all 84 units were leased. Why? The units were affordable and built in a choice neighborhood where jobs, transportation, grocery, entertainment, public facilities and good schools are located, the key ingredients. The households make between 30 percent and 60 percent of the area median income. More than half make less than 50 percent of area median income. We had a good number of two and three bedroom units that families need. We have a well-designed, energy efficient, housing unit that is just as good as a market unit. We have a healthy home, healthy living thematic program that is being implemented to enrich the community in collaboration with partners. These units are restricted to remain affordable for a minimum of 40 years.
As a community we need to develop self-sustaining local sources of funding that are not dependent on federal or local appropriation to help produce affordable housing. The source of income should be modeled on the overall growth and prosperity of our community with a broadbased burden of taxpayers. Such a fund (like the one recently passed City of Denver) has to be dedicated to achieving mixed income communities with emphasis and priority placed on truly affordable units. These local resources — fees, mill levies and taxes — have have a multiplier effect that can be leveraged through bond issues. It is critically important that the focus of affordability stay front and center. The mechanism of administering these funds and the transparent decisionmaking process should be well planned and structured to give it a better than good chance of meeting the needs of the lower income households.
While the fundamental issue is still the need to have well-paying jobs, communities have the ability and responsibility to provide the resources and support in meeting the affordable housing needs. It is not a matter of charity but more about the well-being and health of the community at large. Just as the investment the city makes in public roads, infrastructure, hospitals and utilities safeguard and improve our communities, public participation in meeting the critical affordable housing needs is a long term infrastructure investment that helps create a healthy community. Providing affordable and well-designed, well-built and wellplaced housing has generational rate of returns worth the investment for brighter futures for all of us. Getabecha “Gete” Mekonnen is executive director of Northeast Denver Housing Center Inc., a nonprofit that has worked since 1982 on affordable housing issues.