What’s be­ing done to make hous­ing more ‘af­ford­able’?

The Fresno Bee (Sunday) - - Front Page - BY TIM SHEE­HAN tshee­[email protected]­nobee.com

As hous­ing costs in­crease, rent­ing in Fresno County re­mains af­ford­able. But some fam­i­lies and house­holds earn­ing lower in­comes still strug­gle to lease apart­ments and homes.

As hous­ing costs soar in other parts of the state, Fresno County re­mains a rel­a­tively af­ford­able place to live. The me­dian rent for apart­ments is the sec­ond low­est among Cal­i­for­nia’s largest cities.

But for fam­i­lies and house­holds scrap­ing just to make ends meet, what’s “af­ford­able” for rent is in the eye of the be­holder.

In Fresno County, al­most 60

per­cent of renter house­holds are “rent bur­dened,” or over­pay­ing for rent un­der fed­eral hous­ing guide­lines be­cause they pay at least 30 per­cent of their gross in­come on hous­ing-re­lated costs such as rent and util­i­ties.

In lower-in­come neigh­bor­hoods, how­ever, the U.S. Cen­sus Bureau es­ti­mates that as many as three-quar­ters of all renter house­holds are rent bur­dened. Typ­i­cally, the lower the in­come of a house­hold, the greater the share of the fam­ily re­sources spent on rent and util­i­ties, said Pre­ston Prince, CEO and ex­ec­u­tive di­rec­tor of the Fresno Hous­ing Au­thor­ity.

“We know in Fresno that the av­er­age very-low-in­come house­hold is pay­ing 73 per­cent of their in­come to­ward shel­ter,” Prince said. By com­par­i­son, “me­dian-in­come fam­i­lies pay about 27 per­cent of their in­come to­ward shel­ter. So in our world, they would not be rent-bur­dened.”

“But at some level, even 27 per­cent is still a pretty big chunk of money,” Prince added.

City and county of­fi­cials say the high rates of rent-bur­dened house­holds can be chalked up to a few key is­sues plagu­ing Fresno County: lower-than-av­er­age house­hold in­comes and higher than av­er­age poverty com­pared to the rest of the state, and an acute short­age of apart­ments and other rentals that are af­ford­able for low-in­come res­i­dents.

How acute? Prince said his agency pro­vides Sec­tion 8 Hous­ing Choice vouch­ers for sub­si­dized hous­ing to about 13,000 fam­i­lies in Fresno County, but Prince said there are an­other 40,000 el­i­gi­ble fam­i­lies on the agency’s wait­ing list. “I think there’s prob­a­bly more like 50,000 or 60,000 in­come-el­i­gi­ble house­holds,” he added.

Find­ing ways to close or at least shrink that gap – ei­ther through the de­vel­op­ment of more af­ford­able hous­ing or im­prov­ing the econ­omy and boost­ing fam­ily in­come – is the goal of both the Hous­ing Au­thor­ity as well as city and county lead­ers.

MORE HOUS­ING NEEDED

The Fresno Hous­ing Au­thor­ity is a joint ef­fort be­tween the city of Fresno and Fresno County. Com­bined, it re­ceived more than $86 mil­lion in Sec­tion 8 funds from the fed­eral De­part­ment of Hous­ing and Ur­ban De­vel­op­ment in 2017. The vouch­ers are pri­mar­ily aimed at fam­i­lies whose in­comes are less than 30 per­cent of the me­dian in­come for the area and fall into the cat­e­gory of “ex­tremely low in­come” un­der fed­eral hous­ing guide­lines.

For a fam­ily of four, Prince said, those are fam­i­lies mak­ing about $15,000 or less per year. “Our (clients’) av­er­age house­hold in­come is about $11,000 a year,” he said.

Among pub­lic hous­ing au­thor­i­ties in Cal­i­for­nia, Prince said the Fresno Hous­ing Au­thor­ity is one of the largest de­vel­op­ers of new af­ford­able hous­ing in the state. The au­thor­ity owns or co-owns about 5,000 rental units across Fresno County, and it’s con­stantly in the process of plan­ning for more.

“We might do four real es­tate projects a year, but other (hous­ing au­thor­i­ties) like Tu­lare or Bak­ers­field might do one a year,” Prince said. “And then you go to Stanis­laus and Stock­ton and they’re do­ing their first ones right now. We’re start­ing to build up our ca­pac­ity so that we can meet the hous­ing needs.”

Still, the au­thor­ity doesn’t have enough of its own prop­er­ties to serve all 13,000 of its voucher hold­ers. The agency also has agree­ments with par­tic­i­pat­ing land­lords in the Sec­tion 8 pro­gram to ac­cept the vouch­ers. Ten­ants cover a share of rent up to 30 per­cent to 40 per­cent of their in­come, and the vouch­ers cover the bal­ance of the con­tract rent on the apart­ment.

Land­lords par­tic­i­pat­ing in the Sec­tion 8 pro­gram are sub­ject to in­spec­tions of their prop­er­ties to re­main el­i­gi­ble. But there are plenty of other prop­er­ties – and no one seems quite sure how many – that charge rents that may be “af­ford­able” but are sub­stan­dard.

“Sec­tion 8 is not a com­plete pic­ture of the in­ven­tory,” Prince said. “Land­lords who pro­vide sub­stan­dard hous­ing aren’t el­i­gi­ble to par­tic­i­pate in Sec­tion 8. Other land­lords say the con­tract rental rates re­im­bursed by the county aren’t high enough. so they choose not to par­tic­i­pate.”

The net re­sult is that just be­cause some­one gets a Sec­tion 8 voucher from the hous­ing au­thor­ity, it doesn’t nec­es­sar­ily mean they will be able to find a place to live. In 2017, for in­stance, more than 36,000 peo­ple ap­plied to the agency’s in­ter­est list. Of that num­ber, vouch­ers were is­sued to about 1,800 – only about 5 per­cent of those who ap­plied. But among those who re­ceived the cov­eted vouch­ers, fewer than 1,100 were able find a place to rent.

“Our role is just to fig­ure out if they’re suit­able for a voucher: are they in­come qual­i­fied and do they pass a crim­i­nal back­ground check?” Prince said. “Af­ter that, it’s de­cided by the land­lord. The rea­sons they don’t get leased up could be bad credit, some­thing in their crim­i­nal back­ground, or just a land­lord who says they don’t want to rent to them. Or maybe they just can’t find an af­ford­able place. … There’s a num­ber of is­sues out there.”

One of the big ques­tions con­fronting hous­ing of­fi­cials is, what’s the best way to ac­com­mo­date more fam­i­lies? “Do we ex­pand rental as­sis­tance? Is that the way to go?” Prince asked. “Or do we grow the num­ber of units owned by non­prof­its or hous­ing au­thor­i­ties? … A pri­vate land­lord is al­ways go­ing to be max­i­miz­ing the profit, so they’re go­ing to sell it or do what­ever it is that al­lows them to charge a higher rent.”

Some pri­vate de­vel­op­ers have un­der­taken projects that have at least some units that are re­served to be af­ford­able to qual­i­fy­ing low-in­come fam­i­lies. But those are en­abled by tax cred­its and other eco­nomic in­cen­tives that al­low a project to be prof­itable even with lower rents.

HIGHER IN­COMES NEEDED

Fresno Mayor Lee Brand ac­knowl­edges a need for more rental hous­ing that is af­ford­able for low-in­come res­i­dents. “But it’s not so much that we have an af­ford­able hous­ing prob­lem in terms of high rent,” he said. “We have low wages. So I’m tak­ing kind of a dual ap­proach to solve the prob­lem.”

“One thing is to find ways and mod­els and in­cen­tives to build units (and) have more pro­duc­tion at less cost,” he added. “The other is to get peo­ple jobs and op­por­tu­ni­ties so they have the in­come to qual­ify.”

Brand com­pared rents in Fresno to those in places like San Fran­cisco and the Bay Area, where rents can run as high as $3,000 to $4,500 a month. “You can still get a de­cent rental in Fresno for $1,000 a month. That’s still pretty rea­son­able by any stan­dard, but the is­sue is af­ford­abil­ity,” he said. “If you’re work­ing at $10 an hour, and you’re not get­ting any ben­e­fits, even with two peo­ple it’s some­times hard to qual­ify to make those (rent) pay­ments.”

As mayor since 2016, and as a Fresno City Coun­cil mem­ber be­fore that, Brand has strove to bring not just more jobs to the city, but bet­ter-pay­ing ones. He points to ma­jor new em­ploy­ers such as Ama­zon and Ulta Beauty, each of which opened ma­jor dis­tri­bu­tion cen­ters in Fresno last year and gen­er­ated about 2,000 new jobs.

“If you take Ulta, for ex­am­ple, for a four-day, 10-hour shift they make about $20 an hour, some­thing like $3,400 or $3,500 a month,” Brand said. “One per­son there could qual­ify for a $1,000-a-month unit, which is mar­ket rate hous­ing. Two peo­ple work­ing at Ulta could qual­ify to buy a me­dian-priced home in Fresno.”

“So by em­ploy­ing more peo­ple and get­ting them out of poverty – lib­er­at­ing them from poverty – then

their life is chang­ing,” he added.

On the hous­ing sup­ply side of the equa­tion, the tools avail­able to the city are lim­ited since Cal­i­for­nia did away with re­de­vel­op­ment agen­cies about eight years ago. Re­de­vel­op­ment used prop­erty tax in­cre­ment funds – the dif­fer­ence be­tween old prop­erty tax rates and new rates based on im­prove­ments – to gen­er­ate money for af­ford­able hous­ing and other needs for cities.

“Think of how many down­town Fresno projects would not have been funded with­out re­de­vel­op­ment,” said Brand, par­tic­u­larly cit­ing an ar­ray of mixed-use res­i­den­tial prop­er­ties by de­vel­oper Dar­ius Assemi. “Ev­ery one of those Assemi projects had a com­po­nent that would not have been a busi­ness model that would work with­out hav­ing a 25 or 30 per­cent sub­sidy in the cost of do­ing that.”

Brand is hope­ful that leg­is­la­tion work­ing its way through the state Capi­tol would re­store re­de­vel­op­ment.

In the mean­time, the city is try­ing to smooth its bu­reau­cratic pro­cesses. Bet­ter zon­ing rules, tax cred­its and in­cen­tives called den­sity bonuses can all help re­duce the cost for de­vel­op­ers to build af­ford­able hous­ing in ar­eas of the city that most need it.

“The cost to build down­town is the same as up north. But up north you can get $2 per square foot and down­town you get $1 per square foot. It doesn’t pen­cil out,” Brand said.

Fresno’s new de­vel­op­ment code pro­vides den­sity bonuses, or al­lowances to build more af­ford­able units than or­di­nar­ily per­mit­ted, par­tic­u­larly along some of the city’s key bus-trans­porta­tion cor­ri­dors.

“We’ve worked re­ally hard to make the zon­ing piece rel­a­tively easy across the city,” said Jen­nifer Clark, di­rec­tor of Fresno’s De­vel­op­ment and Re­source Man­age­ment de­part­ment. “We’ve tried to en­sure that we have ad­e­quately zoned sites through­out the com­mu­nity, not just cen­tered in one or two ar­eas, at all sorts of den­sity lev­els.”

“There’s an op­por­tu­nity to make a pro­posal that’s go­ing to be suc­cess­ful be­cause the zon­ing is al­ready in place,” she added.

Just be­cause the land is zoned for mul­ti­fam­ily or af­ford­able hous­ing, how­ever, doesn’t mean de­vel­op­ers will come flock­ing to it. That, Brand said, un­der­scores the need for the fi­nan­cial cred­its and in­cen­tives.

“What does it cost to buy the land? What are the soft costs, de­vel­op­ment fees, school fees, ar­chi­tec­tural en­gi­neer­ing? And then you get into your hard costs. There’s a short­age of la­bor and the cost of ma­te­ri­als is go­ing up,” Brand said. “All these things to­gether cre­ate a fi­nal prod­uct that’s just too ex­pen­sive to re­pro­duce on a large ba­sis.”

If re­de­vel­op­ment pro­grams and tax in­cre­ment funds are re­stored, how­ever, “we could have that method and maybe a few other op­tions, like waiv­ing off-site im­prove­ments or im­pact fees, to make it worth­while.”

WHEN THE PROCESS WORKS

The idea of “pub­lic hous­ing” raises stereo­types in the minds of neigh­bors who fear what it could mean for their neigh­bor­hoods and their prop­erty val­ues. Such deep-seated per­cep­tions about af­ford­able hous­ing give rise to ob­jec­tions rooted in NIMBYism – Not in My Back Yard – whether a project is pub­licly or pri­vately de­vel­oped.

In al­most ev­ery neigh­bor­hood where the Fresno Hous­ing Au­thor­ity con­tem­plates de­vel­op­ing an af­ford­able hous­ing project, neigh­bors raise con­cerns.

In a south­west Fresno neigh­bor­hood near Edi­son High School, al­ready dot­ted with ag­ing pub­lic hous­ing projects, the rel­a­tively new Bridges at Florence pro­vides nearly three dozen af­ford­able apart­ments for se­nior cit­i­zens in at­trac­tive, Cape Cod-style sin­gle-story build­ings.

Even there, ob­jec­tions were voiced. “As we do de­vel­op­ment through­out Fresno County, we ex­pe­ri­ence peo­ple who have ques­tions and con­cerns,” Prince said. “The way we over­come that is we start with de­sign. … If peo­ple see that we’re bring­ing qual­ity hous­ing into their neigh­bor­hood, they’ll be sup­port­ive.”

Parc Grove Com­mons, a Fresno Hous­ing Au­thor­ity de­vel­op­ment at the south­east cor­ner of Clin­ton Av­enue and Fresno Street, across the street from the Vet­er­ans Ad­min­is­tra­tion Cen­tral Cal­i­for­nia Health­care Sys­tem in cen­tral Fresno, is a high­light for the agency’s ef­forts.

For more than 60 years, the site was home to about 200 units of World War II-era hous­ing, orig­i­nally built as mil­i­tary hous­ing to serve Ham­mer Field (now Fresno Yosemite In­ter­na­tional Air­port) and later used as pub­lic hous­ing. Those bleak build­ings were even­tu­ally torn down to make way for about 350 units of at­trac­tive, af­ford­able apart­ments, in­clud­ing one 40-unit build­ing, Re­nais­sance at Parc Grove, for for­merly home­less vet­er­ans.

Parc Grove Com­mons stands in stark con­trast to the nearby Sum­mer­set Vil­lage, a pri­vately-owned 220-unit com­plex where gas pipeline prob­lems forced about 1,000 res­i­dents to go for weeks with­out heat or hot wa­ter in Novem­ber 2015. City code in­spec­tors sub­se­quently found more than 1,400 code vi­o­la­tions and the out-of-town owner was ul­ti­mately hit with fines of nearly $175,000.

The prob­lems at Sum­mer­set Vil­lage helped spur the city of Fresno into sev­eral tough-on-slum­lord mea­sures, in­clud­ing the cre­ation of a rental-hous­ing reg­istry and a pro­gram for reg­u­lar in­spec­tions of rental prop­er­ties through­out the com­mu­nity, re­gard­less of whether they are apart­ments or houses or where in the city they are lo­cated.

Both pub­lic hous­ing or pri­vately-owned apart­ments, though, con­front strong bi­ases by neigh­bors.

“Af­ter six years on the Plan­ning Com­mis­sion and eight years on the City Coun­cil, I can tell you that ev­ery time an apart­ment project comes up, (peo­ple say) ‘You’re go­ing to ruin the neigh­bor­hood.’ ‘Crime is go­ing to up.’ ‘My re­sale value will fall,’ ” Brand said. “There was a deal at Al­lu­vial and Chest­nut av­enues (in north­east Fresno), when some­one wanted to be re­zoned for apart­ments, and a sign went up that said, ‘Look out for Sec­tion 8 hous­ing.’ … It had noth­ing to do with Sec­tion 8. A lot of that is just overblown fears that peo­ple have.”

Prince said he be­lieves the con­cerns over pub­lic hous­ing are a mat­ter of mis­un­der­stand­ing that can be over­come if the agency works to ed­u­cate the neigh­bors in ad­vance, be­fore a pro­posed project takes them by sur­prise.

“It’s about good-neigh­bor poli­cies, hav­ing com­mu­ni­ca­tion be­fore we do a de­vel­op­ment with com­mu­nity mem­bers,” he said. “And then it’s about main­tain­ing our prop­er­ties re­ally well. If we show it’s a good as­set and that res­i­dents are ad­ding value to the over­all neigh­bor­hood, the over­all com­mu­nity, we can over­come NIMBYism.”

“I think the big­gest myth is some­how that peo­ple lack val­ues or morals. But they have morals. They just have low in­comes,” Prince added. “They’re look­ing af­ter their fam­i­lies, they’re in­vest­ing in their kids and their kids’ ed­u­ca­tion, and that’s what hap­pens when peo­ple are not spend­ing 72 per­cent of their in­come on rent.”

“These are good peo­ple. They just hap­pen to have low in­comes.”

ERIC PAUL ZAMORA [email protected]­nobee.com

Af­ford­able hous­ing apart­ments, part of the Kings Canyon Con­nec­tiv­ity Project, are seen Thurs­day along Kings Canyon Av­enue east of Wil­low Av­enue. Mak­ing more hous­ing avail­able for low-in­come res­i­dents is one ap­proach to low­er­ing the num­ber of rent-bur­dened house­holds.

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