Each year the Spotlight highlights successful endeavors which provide affordable homes and sustain community. The Spotlight is unique in that it not only describes the valuable outcomes, but provides sufficient detail to understand the creativity, collaboration, and commitment it takes to complete successful projects.
The most recent Spotlight features Urban Homeworks (UHW) in Minneapolis and their creative approach to reclaiming Minneapolis neighborhoods and building opportunity for all residents. Chad Schwitters, the Executive Director of Homeworks, has a waiting list of more than 400 families who need safe affordable homes. He notes: “I think we’re starving for innovative and creative solutions—ones that excite and compel people to get behind. The more we can work together to frame those solutions and get people to get behind them, the closer we are to a healthier community for all.”
The Spotlight highlights three key factors that drive Urban Homeworks’ success:
People oriented development: at the foundation of Urban Homeworks’ mission is a commitment to people oriented development—putting people first. The idea behind the POD model is to develop community through the physical development of actual neighborhoods and psychologically through the natural relationships that develop among neighbors. The average stay for families in UHW homes is three years, meaning they have time to build connectivity, kids find stability, and parents can move their careers forward.
Creative finance: Urban Homeworks has developed a robust loan pool structure which draws from large donor bases established throughout various congregations and corporations. The loan pool is a social investment opportunity allowing investors to purchase interest in a single asset LLC, earn a reasonable rate of return, and their dollars go directly to building the community. Chad comments: “If you can open an E-trade account and put your excess capital on Wall Street in 20 minutes, then you should be able to open a community equity trust account on our website and put your excess capital on West Broadway and Lake Street in 20 minutes.” Another central part of the financial strategy is the acquisition process, which hinges on the UHW’s ability to negotiate sales directly with landlords who already own parcels of assets in the community, acting quickly when properties become available, and maintaining relationships in the neighborhood and with local government.
Building together: Urban Homeworks considers itself as one tool in the tool-belt. To illustrate the level of partnership UHW engages in, the Spotlight highlights Lovell Square—the UHW development of ten properties in north Minneapolis. Members of Christ Presbyterian Church raised $50,000 for the project … which spurred numerous partners and investors. A large base of community advocates and committed volunteers also backed the development. Chad notes: “Many of the volunteers contribute labor and leave with a new perspective that influences their understanding of the ‘urban poor’ and how they can play a part in breaking down barriers they have (intentionally or unintentionally) been a part of creating.” Lovell Square also served as training ground for UHW’s construction training program, which utilizes the construction sites as classrooms where trainees build skills and rebuild their own neighborhoods while working to obtain their GEDs. Work that couldn’t be carried out by volunteers and trainees was contracted out to local minority and women-owned contractors and subcontractors. Eighty-six percent of the redevelopment costs from the development went to local contractors, which, in turn, helped build local businesses and strengthen the local economy.
Each Impact Spotlight shares similar highlights building a broad understanding and respect for maintaining and investing in the people who develop and the communities who benefit from affordable homes. MHP is proud to support those highlighted in the Spotlight who participate in and benefit from MHP’s work in policy and capacity building.
Mary Brooks, Senior Advisor, Center for Community Change–Housing Trust Fund Project
The North Dakota Housing Finance Agency has launched Faces of Home to share with the public and elected officials the positive outcomes the Agency’s Federal, state and local housing programs offer for North Dakotans and their communities. Faces of Home, as part of a national effort led by the National Council of State Housing Agencies, is a series of stories highlighting the success of people who engage in NDFHA housing programs. Interviews and photos offer a glimpse into life changes North Dakotans have made as they benefit from NDHFA programs and investments. NDHFA publicizes Faces of Home stories in their bi-monthly newsletter, on the agency Facebook page, and as a library on the NDFHA website. Housing advocates, program supporters and other interested parties can download the stories, which are formatted to print out as a one or two page document. NDFHA has provided print copies as background to legislators, as well as using anecdotes from the stories in legislative testimony.
With a place to call his own, David Hippe enjoys the comforts of home.
Faces of Home features two pieces on the positive impact of the North Dakota Housing Incentive Fund (HIF), the state’s housing trust fund: one very personal, Enjoying Life Little Luxuries, and one about community impact, Meeting a Need in the Community. The HIF is funded through contributions from individuals or corporate taxpayers who receive in exchange a 100 percent tax credit. The HIF funds the development of affordable multi-family housing for essential service workers, main street employees and fixed-income households. In April 2015, in addition to approving a $30 million two-year extension of the HIF tax credit, the North Dakota legislature added $5 million to the HIF from the Bank of North Dakota, with an additional $5 million pledged for 2016 if 2015 profits reach predicted levels.
Enjoying Life’s Little Luxuries features the stories of George ‘Hoppy’ Vogel and David Hippe. Thanks to an investment from the Housing Incentive Fund, Hoppy and David were able to move into their own apartments from a group home in Bowman, North Dakota. Both men have developmental disabilities. While Hoppy and David benefitted from support services, the group setting provided much more intensive programs than either man requires. The opportunity to live independently outside the group home setting has allowed both of them to thrive. Hoppy, who derived his nickname from Hopalong Cassidy and is in his seventies, moved into the Bowman group home in 1985. Upon moving into his apartment, Hoppy’s medical team was concerned about his inability to put on weight. After a few months living with a fridge stocked with his favorite foods, Hoppy has put on seven pounds! David, who in his mid-twenties, is relishing the social freedom that his apartment provides. He enjoys entertaining his friends in his carefully decorated apartment, featuring memorabilia from his favorite football team, the Dallas Cowboys. The ability to have friends over to watch a movie or to have a cup of coffee has transformed David’s outlook on life.
Meeting a Need in the Community profiles Kris Fehr, a longtime resident of Dickinson, who used HIF funds to rehabilitate a 100-year old property into ten affordable apartments in 2013. The Dickinson community has experienced a severe housing shortage as a result of the oil and gas boom that brought thousands of workers to small, rural communities with limited housing stock. Fehr noticed the fracture occurring in Dickinson, as ambulance drivers, firefighters, store clerks, office managers, dental hygienists and other core members of the community were being priced out. She and her husband learned about the HIF and decided to develop the housing their community was lacking. “I was hearing heartbreaking stories,” said Fehr. “Rents were increasing and some residents couldn’t afford to stay here. . . People not making big money, yet working. . . I felt like we could make a difference and help address our communities housing needs.” Since the HIF was established in 2011, developers like Fehr have built or rehabilitated more than 1,500 homes and apartments in communities across the states.
In addition to stories on the impact of the Housing Incentive Fund, Faces of Home features articles on NDHFA’s HomeAccess Program, Homeownership Program, Law Enforcement Pilot Program, Low Income Housing Tax Credit Program, Neighborhood Stabilization Program, North Dakota Roots, and Souris River Flood Recovery program.
Avesta Housing and Maine Affordable Housing Coalition collaborated in publishing a 4 page brochure that clearly displays the impact for downtown Portland from an investment which turned a run-down parking lot into 37 beautiful and affordable apartments—Oak Street Lofts. What is unique and impressive about this illustration is that it is a concrete documentation of the actual impact of one development, compiled by the development organization.
The Project Development Team involved eight companies. Another sixty-one companies were service providers, sub-contractors and suppliers—at least one-third of whom are located in Portland. Oak Street Lofts required 332 workers and total local spending on construction alone was $4.1 million, including $2.3 million for materials. Workers employed included: electricians, drywallers, steelworkers, plumbers, heating system workers, tillers, and carpenters.
The project paid $53,000 in municipal fees and will increase the City’s property tax revenues by about $30,000 a year. In addition, construction generated about $250,000 in state income, sales taxes, and other fees. Energy efficiency standards employed in the construction of Oak Street Lofts save about $400 per year per apartment versus comparable apartments in the area—that’s $15,000 a year for the building as a whole.
Impressed ? And many residents of Oak Street Lofts work at local restaurants, shops and businesses … continuing the contribution to the economic and cultural life of Portland for years to come.
A consistent challenge for housing trust fund advocates is explaining the complex subjects of the economic impact of affordable housing development and how local and state investment leverage additional public and private funds. Making the argument well requires being credible, compelling and easy to understand. The Florida Housing Coalition’s 2014 Home Matters Report includes an excellent section on economic impact and leverage that provides some ideas and examples from which to draw for fellow advocates.
With informative graphics and clear language, the report explains the economic impact of public investment in affordable housing in five pages, with a particular focus on the ability of state investment to leverage significant Federal and private resources. The section also highlights the increased revenue for state and local governments generated from developer permits and impact fees, and local sales tax revenue from construction related purchases, and that the jobs created by the development of affordable homes pay well. In 2010, Florida’s investment of $1.24 billion resulted in more than $178 million in property, excise, and sales taxes from businesses involved in housing development and rehabilitation. Carpenters, construction laborers and first-line supervisors have entry level wages more than $10 per hour and median wages at more than $15 per hour.
Grounding the report is a 2012 study from the University of Florida on state and federal housing programs administered by the Florida Housing Finance Corporation in 2010. The study focuses on the impact of Federal and state investment in the development and rehabilitation of affordable homes, which in 2010 produced 41,260 jobs, more than $4.8 billion in total economic output, and more than $1.7 in labor income.
The report’s explanation of leverage is particularly powerful. Based on $222 million in revenue that should have been allocated to Sadowski Act housing programs but instead was swept by the legislature for other purposes, the report outlines how the state lost more than $1.5 billion in potentially leveraged revenue from Federal tax-exempt bonds and tax credits. The report also explains the differing leverage generated by the SHIP and SAIL programs, two main programs supported by the Sadowski trust fund. SHIP primarily provides funding for construction and rehabilitation of affordable ownership housing, down payment assistance, and limited rental development; for every dollar invested in SHIP, $4.20 is leveraged. SAIL provides low-interest loans for developing multifamily rental housing; for every dollar invested in SAIL, $5.29 is leveraged.
The Florida Housing Coalition produced the report in support of HomeMatters® a national movement to make home a reality for everyone by elevating the importance of a home’s impact on people’s health, education, personal success, public safety and the economy. The report was a key advocacy tool in the Florida Housing Coalition’s successful effort to prevent the Florida Legislature from sweeping all of the revenue from the Sadowski Trust Funds intended for the SHIP, SAIL and other established state housing programs. In addition to addressing the economic impact of public investment in affordable housing and making the case for preserving Sadowski Act funds for affordable housing, the report explores the importance of increasing the supply of affordable homes in terms of positive impacts to community health, education, transportation, as well as reduced tax payer expenses. The report also provides a concise, clear explanation of Florida’s housing shortage, and the nuances of affordable housing development. To down load the full report, click here.
Michael Anderson, Deputy Director, Center for Community Change–Housing Trust Fund Project