Does Raleigh’s affordable housing bond do enough for the city’s poorest residents?
Raleigh voters will decide during the 2020 election whether to back an $80 million bond for affordable housing that everyone agrees the city needs.
The bond would help build and repair homes and offer first-time homeowners financial help. The city’s first housing bond in almost a decade, it would likely raise Raleigh’s property tax rate by 0.78 cents per $100 valuation. The owner of a median-price home would pay $23.40 more in city property taxes a year.
But some vocal housing advocates are urging residents to vote against the bond.
“I don’t think it’s political,” said Yolanda Taylor, of the Wake County Housing Justice Coalition. “I think it’s moral. It’s a moral issue. We have to decide what we want our city to look like and do.”
Supporters say with an eviction crisis looming and greater inequities exposed by the COVID-19 pandemic, the city has to pass the bond now.
“What’s the option?” Raleigh Mayor Mary-Ann Baldwin asked. “We do nothing? That’s not an option.
“The need is greater than ever,” Baldwin said in an interview. “Doing nothing is not an option. And, to me, right now is absolutely the right time for people to step forward and say: ‘This is important. We need to care for our most vulnerable citizens and residents.’ And I think many people will be willing to do that.”
At the crux of the issue is whether the bond will do enough for the city’s lowest-income residents.
‘My own place’
John McMillan works and gets paid every week but said he can’t find an affordable place to live. He’s been homeless since he moved to Raleigh earlier this year.
He tries to avoid boarding rooms because things get stolen, he said. He’ll sometimes stay at hotels when he can afford it, and he visits the men’s shelter off of South Wilmington Street to grab a shower.
“It’s crazy,” he said. “I just want to have my own place for my own stuff. My own space. I just can’t afford it because they want a deposit and then you have to pay first-month rent. Going through a pandemic. You just don’t have it.”
Raleigh should do more to specifically help people who are homeless, he said.
Oak City Cares, which helps connect homeless people to services they need, estimates nearly 5,500 people in Wake County experienced homelessness last year.
The largest chunk of the city’s proposed bond — $28 million of the $80 million — would go to public-private partnerships. One would be a new housing development for “chronically homeless individuals.” It would create at least 50 affordable housing units and would cost about $10 million.
“COVID has certainly exposed the need of our homeless community,” Baldwin said. “We need to be doing more. We were excited that Oak City Cares opened and we have this multi-service center, but COVID has clearly demonstrated we don’t have adequate housing for our homeless.”
Whom does the bond help?
People are considered low income if they make less than 80% of the area median income (AMI). The AMI used for Raleigh covers all of Wake, Franklin and Johnston counties.
Some bond criticssay it doesn’t do enough to help those who are considered extremely low income, the people who are at 30% or below the AMI.
Raleigh City Council member David Cox wrote on his website that he doesn’t support the bond and said just a small portion of it would help this group.
“City government does not need to be in the business of funding market and near market-rate housing while building only a small number of affordable housing units,” he said.
“Developers in Raleigh do not need a blank check from Raleigh taxpayers,” he said. “As a consequence, I do not support the city’s housing bond.”
There are 24,685 households at or below 30% AMI in Raleigh, according to U.S. Housing and Urban Development definitions Raleigh uses in the city’s five-year plan to address affordable housing. To be considered extremely low-income a one-person household must make $19,800 or less a year. For a family of four, it’s $28,250 or less.
More than 60% of those extremely low-income households spend more than half of their income on their homes, meaning they are in need of affordable housing.
Wake County and the Raleigh Housing Authority have primarily been responsible for housing people considered extremely low income, Baldwin said. Raleigh has focused on “workforce housing” for those other groups, who fall between 60% and 80% AMI, she said.
“If you try and build all 30% AMI the numbers don’t work,” Baldwin said.
Gap financing
The second-largest chunk of the bond — $24 million — would go toward gap financing. It’s is the traditional way the city has helped provide affordable housing in the city. It could lead to adding 700 affordable housing, likely rental units with an average city subsidy of $35,000 per unit.
Affordable housing developers apply for competitive tax credits and ask the city for help to cover the cost of providing the affordable units.
About a third of the units in the city’s last 13 affordable housing developments have been filled by people making 30% AMI or less, according to a recent city presentation.
Taylor, who is a housing and community economic development attorney, is sympathetic to that “workforce” group looking for an affordable place to live in Raleigh. She used to fall in that category.
About 10 years ago, she and her husband were renting an apartment near WakeMed. When they went to buy their first home they were priced out of the city and eventually moved to Wake Forest.
“We realized some apartments were renting for over $1,000 a month,” she said. “And our Realtor was telling us: ‘You’ve got to get a house. You’re already paying a mortgage payment.’ At that point, we realized we had to look outside of Raleigh.”
Better sidewalks, street lights
The Wake County Housing Justice Coalition, which was formed last year, recommends people vote against the bond. The city can use its current federal money and the money raised from a 2016 property tax increase to add workforce housing. The bond should focus on those with the greatest need, she said.
Raleigh leaders should push for a new bond that focuses primarily on extremely low-income people and creates policies that will slow gentrification, she said.
These “historically low-income African-American communities” want revitalization after years of disinvestment, Taylor said, but not at the expense of being pushed out of the neighborhoods.
“They want better sidewalks,” she said. “They want street lights. They want more grocery stores and things that lead to better health like parks and bike trials. But they want to share in the prosperity that happens. They want to share in the benefits that are occurring in these communities.”
Raleigh residents shouldn’t be satisfied with a bond that doesn’t address those needs, Taylor said.
“Personally to me, as a woman of color, something is not better than nothing,” she said. “Because of the simple fact you continue to accept something is better than nothing, those who have nothing will continue to be pushed down.”
‘Holistic approach’
Asa Fleming, a Raleigh real estate agent, has seen housing prices rise throughout the last decade. The Raleigh Chamber of Commerce has promoted the city’s bond and Fleming is co-chair of the chamber’s bond committee.
He’s heard the criticisms but said he believes the bond wouldn’t get enough buy-in if it only focused on one group.
“You’re going to have that with any bond,” he said. “I’ve heard some of the arguments, but this bond addresses a wide variety of areas. One of the things we need to do is having a blanketed approach. A holistic approach. So we can get buy-in.”
“We are addressing this the best way we know how. It’s a start,” Fleming said. “I think this is really going to address the critical needs of affordability in our city. I think this sets our city up to be successful in the future. This is why I am doing it.”
Early voting ends this week. Polls are open 6:30 a.m. to 7:30 p.m. Tuesday. Visit newsobserver.com/voter-guide to learn more about the upcoming election.
This story was originally published October 28, 2020 at 12:08 PM.
