• 15May

    Here is the new language that appears to have unanimous support from the council.  In short, almost every affordable housing project gets some sort of Federal, State, or Local tax subsidy.  As such we have an obligation to make sure that money is well spent.  Our policy now more explicitly states what is affordable housing.  Our policy considers Housing costs, Energy costs, Associated costs, and Transportation costs.  As you would expect many properties that are cheap are not actually affordable when all costs are considered.

     

    The Need for Affordable Housing

     

    The City of Rochester is suffering from a critical shortage of affordable housing (housing that, through subsidy or other means, costs no more than 30% of the household income of households earning 80% of the area’s median income).  The proportion of households in Rochester paying more than 30% for housing has increased from around 20% of households in 2000 to over 27% in 2010.[1] There were 11,430 households in Rochester paying over 30% of income for housing in 2010.

     

    However, this understates the true extent of housing need. The true long term costs of affordable housing to the tenant or owner or the community can be best represented using an index made up of

     

    H – The initial Housing construction or purchase cost is reflected in the rent or mortgage payment. Housing costs (excluding furnishings, supplies, and utilities) made up 21.9% of consumer expenditures in the U.S. in 2009[2]. (Adding utility costs brings the housing cost share up to 29.3%.)

     

    E – The cost of Energy used to light or heat the apartment or house and the cost of energy used in travel. Utilities (electricity, heat, and so on) comprised 7.4% of total consumer expenditures in the US in 2009. Energy is one of the most volatile components of total housing cost  Energy codes have come a long way in the last 25 years, but there can still be huge difference between the best and the worst of construction. As a general rule, multifamily housing will always be more efficient than single family detached housing.  The location of housing will also determine whether gasoline costs will be significant or non-existent. 

     

    A –  The Associated costs, sometimes in the form of an association fee but more commonly showing up as maintenance, averaged 2.3% of consumer expenditures in 2009.  The long term maintenance cost is typically inversely correlated with the upfront housing costs (H).  Cheaper construction carries with it higher long term maintenance costs and higher life-cycle costs.  Using interior and exterior materials that are designed to last no more than 10-15 years will lower the upfront price but actually make the total cost increase.

     

    T –  The final component of examining the true cost of affordable housing is transportation (T).  The energy cost of transportation and the costs of vehicle ownership, insurance, maintenance, and so on add significantly to household budgets, averaging 15.6% of U.S. consumer expenditures in 2009. Over the last decade public agencies have started to reflect the cost of transportation as part of the true cost of affordable housing.  Most medium to large sized cities have the transit capacity to locate affordable housing in places that potentially eliminate all or most of this expense.  By providing affordable housing opportunities in mixed use, mixed income, transit oriented areas we can create an environment where resources and opportunities are present without the need for expensive transportation options.

     

    In addition to associated costs that pertain to the resident, there are associated costs incurred by the city or other taxing authorities contributing to the cost of a project or absorbing costs as a result of a development.  Such costs may include subsidizing new infrastructure such as roadway, water, sewer, or stormwater infrastructure.  By examining the total Housing, Energy, Associated, and Transportation costs, we can make a better determination as to whether or not housing is truly affordable. 

     

    Many of the jobs that are created by area employees rely on workers working at moderate wage rates.  According to a number of economic forecasters, the major impediment to the continued economic growth of the Rochester-Olmsted community will be difficulty in attracting the labor force needed to replace retiring baby boomers. The ability of employers to attract workers is adversely affected by the shortage of truly affordable housing.

     

    The Need for Integration

     

    Some neighborhood groups have opposed affordable housing proposals based in part on concerns about increased traffic, increased crime, and adverse impacts on property values. Opposition to affordable housing in areas adjacent to established neighborhoods threatens to exclude affordable housing from newly developing areas. Such exclusion may result both in a shortage of affordable housing as well as in a community that is segregated by income class. Segregation by income class may lead to de facto segregation by race in our community. Continuing to curtail the supply of sites for affordable housing in fringe locations will jeopardize the supply of affordable housing and will result in concentrating affordable housing in a few heavily impacted neighborhoods.

     

    The 21st Century Partnership Diversity Task Force Report discusses the need to increase the supply of affordable housing and the need to provide affordable housing in scattered locations throughout area communities. Evidence from a number of national studies confirms that scattered subsidized and other lower cost housing development does not adversely affect adjacent areas. On the other hand, studies indicate that segregating lower cost housing in a few neighborhoods clearly destabilizes those neighborhoods, leading to declining housing stock quality, declining performance in neighborhood schools, and other social problems.

     

    We are at a crossroads in our community. We can design our future to consist of integrated neighborhoods with an adequate supply of housing in a variety of price ranges. Or we can design our community to consist of concentrated pockets of lower cost housing isolated from the remainder of the community. The experience of other cities in the US clearly indicates that integration is the more desirable future.

     

    Dividing our community either by income or by race fosters inequity, isolation, barriers to communication, and ultimately divisiveness. Income class segregation, even without corresponding race segregation, is inimical to the long term cohesiveness of our community and to our quality of life. Community segregation leads to family, neighborhood, and ultimately community instability.

     

    inclusive2_6907.jpgWhat is true of income class and race is also true of other groups within the community. Separating the elderly and the disabled from neighborhood life inappropriately isolates these residents from community life. Our challenge is to build a community made up of inclusive neighborhoods that provide safe, secure, and neighborly environments in which all of us can  thrive. 

     

    Rochester’s Diversity Principles

     

    The City of Rochesteris committed to building an inclusive community. To this end, the City of Rochester is committed to:

     

    ·        Supporting  the Olmsted County Human Rights  Ordinance and the work of the Olmsted County Human Rights Commission in implementing the Ordinance;

     

    ·        Supporting low income tax credit housing and other subsidized housing of high quality, in locations that are accessible to employment, neighborhood amenities, and commercial services.

     

    ·        Supporting well designed private development proposals that include townhouses, condominiums, apartments, and appropriate commercial uses as part of neighborhood development areas.

     

    ·        Enforcing minimum standards for housing and enforce such ordinances as the Disorderly Use Ordinance in order to address neighborhood concerns about crime and potential impacts on property values.

     

    ·        Increasing the supply of land zoned for lower cost housing, especially providing for mixtures of housing by style and cost.

     

    ·        Providing for neighborhoods that are integrated by income class, race, age, and  ability, and that are accessible to all modes of travel by all age and ability levels.

     

    ·        Providing incentives to developers to accommodate affordable housing up front as part of well-planned communities.

     

    ·        Communicating to neighborhood groups and community members

     

    Øthat lower income households are not equivalent to lower quality families,

     

    Øthat the “goodness” of a neighborhood is not measured by the price of its structures but by the character of its residents, and

     

    Øthat the quality of a community is not measured by the degree to which it is exclusive.

     

    ·        Encouraging neighborhood organizations to create a welcoming environment in all neighborhoods for persons of diverse age, ability, ethnic, and economic backgrounds.

     



    [1] US Census American Community Survey 2010.

    [2] Source: U.S. Bureau of Labor Statistics, Consumer Expenditures in 2009, for all cited expenditure data. In effect, these figures represent averages for households. Because the share of basic necessity expenditures is low for very affluent households, the median household shares for these expenditures would be significantly higher.

     

     

    COMPREHENSIVE PLAN POLICY ON

    AFFORDABLE HOUSING AND DIVERSITY

     

    The Need for Affordable Housing

    The City of Rochester is suffering from a critical shortage of affordable housing (housing that, through subsidy or other means, costs no more than 30% of the household income of households earning 80% of the area’s median income).  The proportion of households in Rochester paying more than 30% for housing has increased from around 20% of households in 2000 to over 27% in 2010.[1] There were 11,430 households in Rochester paying over 30% of income for housing in 2010.

    However, this understates the true extent of housing need. The true long term costs of affordable housing to the tenant or owner or the community can be best represented using an index made up of

    H – The initial Housing construction or purchase cost is reflected in the rent or mortgage payment. Housing costs (excluding furnishings, supplies, and utilities) made up 21.9% of consumer expenditures in the U.S. in 2009[2]. (Adding utility costs brings the housing cost share up to 29.3%.)

    E – The cost of Energy used to light or heat the apartment or house and the cost of energy used in travel. Utilities (electricity, heat, and so on) comprised 7.4% of total consumer expenditures in the US in 2009. Energy is one of the most volatile components of total housing cost  Energy codes have come a long way in the last 25 years, but there can still be huge difference between the best and the worst of construction. As a general rule, multifamily housing will always be more efficient than single family detached housing.  The location of housing will also determine whether gasoline costs will be significant or non-existent. 

    A –  The Associated costs, sometimes in the form of an association fee but more commonly showing up as maintenance, averaged 2.3% of consumer expenditures in 2009.  The long term maintenance cost is typically inversely correlated with the upfront housing costs (H).  Cheaper construction carries with it higher long term maintenance costs and higher life-cycle costs.  Using interior and exterior materials that are designed to last no more than 10-15 years will lower the upfront price but actually make the total cost increase.

    T –  The final component of examining the true cost of affordable housing is transportation (T).  The energy cost of transportation and the costs of vehicle ownership, insurance, maintenance, and so on add significantly to household budgets, averaging 15.6% of U.S. consumer expenditures in 2009. Over the last decade public agencies have started to reflect the cost of transportation as part of the true cost of affordable housing.  Most medium to large sized cities have the transit capacity to locate affordable housing in places that potentially eliminate all or most of this expense.  By providing affordable housing opportunities in mixed use, mixed income, transit oriented areas we can create an environment where resources and opportunities are present without the need for expensive transportation options.

    In addition to associated costs that pertain to the resident, there are associated costs incurred by the city or other taxing authorities contributing to the cost of a project or absorbing costs as a result of a development.  Such costs may include subsidizing new infrastructure such as roadway, water, sewer, or stormwater infrastructure.  By examining the total Housing, Energy, Associated, and Transportation costs, we can make a better determination as to whether or not housing is truly affordable. 

    Many of the jobs that are created by area employees rely on workers working at moderate wage rates.  According to a number of economic forecasters, the major impediment to the continued economic growth of the Rochester-Olmsted community will be difficulty in attracting the labor force needed to replace retiring baby boomers. The ability of employers to attract workers is adversely affected by the shortage of truly affordable housing.

    The Need for Integration

    Some neighborhood groups have opposed affordable housing proposals based in part on concerns about increased traffic, increased crime, and adverse impacts on property values. Opposition to affordable housing in areas adjacent to established neighborhoods threatens to exclude affordable housing from newly developing areas. Such exclusion may result both in a shortage of affordable housing as well as in a community that is segregated by income class. Segregation by income class may lead to de facto segregation by race in our community. Continuing to curtail the supply of sites for affordable housing in fringe locations will jeopardize the supply of affordable housing and will result in concentrating affordable housing in a few heavily impacted neighborhoods.

    The 21st Century Partnership Diversity Task Force Report discusses the need to increase the supply of affordable housing and the need to provide affordable housing in scattered locations throughout area communities. Evidence from a number of national studies confirms that scattered subsidized and other lower cost housing development does not adversely affect adjacent areas. On the other hand, studies indicate that segregating lower cost housing in a few neighborhoods clearly destabilizes those neighborhoods, leading to declining housing stock quality, declining performance in neighborhood schools, and other social problems.

    We are at a crossroads in our community. We can design our future to consist of integrated neighborhoods with an adequate supply of housing in a variety of price ranges. Or we can design our community to consist of concentrated pockets of lower cost housing isolated from the remainder of the community. The experience of other cities in the US clearly indicates that integration is the more desirable future.

    Dividing our community either by income or by race fosters inequity, isolation, barriers to communication, and ultimately divisiveness. Income class segregation, even without corresponding race segregation, is inimical to the long term cohesiveness of our community and to our quality of life. Community segregation leads to family, neighborhood, and ultimately community instability.

    inclusive2_6907.jpgWhat is true of income class and race is also true of other groups within the community. Separating the elderly and the disabled from neighborhood life inappropriately isolates these residents from community life. Our challenge is to build a community made up of inclusive neighborhoods that provide safe, secure, and neighborly environments in which all of us can  thrive. 

    Rochester’s Diversity Principles

    The City of Rochesteris committed to building an inclusive community. To this end, the City of Rochester is committed to:

    ·        Supporting  the Olmsted County Human Rights  Ordinance and the work of the Olmsted County Human Rights Commission in implementing the Ordinance;

    ·        Supporting low income tax credit housing and other subsidized housing of high quality, in locations that are accessible to employment, neighborhood amenities, and commercial services.

    ·        Supporting well designed private development proposals that include townhouses, condominiums, apartments, and appropriate commercial uses as part of neighborhood development areas.

    ·        Enforcing minimum standards for housing and enforce such ordinances as the Disorderly Use Ordinance in order to address neighborhood concerns about crime and potential impacts on property values.

    ·        Increasing the supply of land zoned for lower cost housing, especially providing for mixtures of housing by style and cost.

    ·        Providing for neighborhoods that are integrated by income class, race, age, and  ability, and that are accessible to all modes of travel by all age and ability levels.

    ·        Providing incentives to developers to accommodate affordable housing up front as part of well-planned communities.

    ·        Communicating to neighborhood groups and community members

    Øthat lower income households are not equivalent to lower quality families,

    Øthat the “goodness” of a neighborhood is not measured by the price of its structures but by the character of its residents, and

    Øthat the quality of a community is not measured by the degree to which it is exclusive.

    ·        Encouraging neighborhood organizations to create a welcoming environment in all neighborhoods for persons of diverse age, ability, ethnic, and economic backgrounds.



    [1] US Census American Community Survey 2010.

    [2] Source: U.S. Bureau of Labor Statistics, Consumer Expenditures in 2009, for all cited expenditure data. In effect, these figures represent averages for households. Because the share of basic necessity expenditures is low for very affluent households, the median household shares for these expenditures would be significantly higher.

    Posted by mwojcik @ 4:07 pm

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