The City of Milwaukee Housing Trust Fund Finance Subcommittee has proposed a regional housing trust fund in southeastern Wisconsin. The fund would combine the City of Milwaukee Housing Trust Fund with the Milwaukee County Special Needs Housing Trust Fund and the Milwaukee County Inclusive Housing Fund. Eventually, the regional housing trust fund could be expanded to include other counties and possibly the entire seven-county region.
The region includes the counties of: Kenosha, Milwaukee, Ozaukee, Racine, Walworth, Washington and Waukesha counties. The initial intent is to promote a thoughtful discussion on housing as a regional issue that nurtures economic growth and vitality as part of the strategic conversation for the Southeastern Wisconsin Regional Planning Commission housing study.
The notion of a regional housing trust fund was raised in the 2009 Public Policy Forum report on growing housing issues faced in Milwaukee. Potential advantages noted included greater impact by spreading administrative support across a broader spectrum of projects and achieving additional stable funding streams.
The regional housing trust fund would have two classes of membership:
- voting membership for those jurisdictions that contribute financial resources and
- advisory membership for those who are willing to participate in discussions about the role affordable housing plays in the economic well-being of the region.
While Wisconsin imposes limitations on dedicated public revenue source options, the proposal recognizes three potential sources:
- tax incremental financing (recent state legislation enables local communities to extend the life of TIF districts for up to one year and use the proceeds to support affordable housing); and
- federal funds (including Community Development Block grants and HOME funds).
In 2005, the City of Milwaukee established a Housing Trust Fund and has provided $3 million in grants and loans, leveraging $62 million in other funds to produce 421 housing units.
In 2007, Milwaukee County established a Housing Trust Fund with a focus on persons who are served by the Behavioral Health Division of the Milwaukee County Department of Health and Human Services. The fund is currently financed through low-interest loans from the State of Wisconsin Trust Fund Loan Program. Three million was authorized for this purpose leading to funding approximately 300 units of supportive housing.
The Milwaukee County Inclusive Housing Fund was established with $1 million from the proceeds of a land sale to help build workforce housing within the City of Milwaukee. And Waukesha County has considered the creation of a county housing trust fund.
The core function of the regional housing trust fund would be to provide grants and loans for affordable housing development or rehabilitation projects that meet the objectives established for the trust fund. The fund would also help lead and coordinate the development of a regional housing strategy.
While the proposal explores the potential for including private sources of funds, it does not recommend that the fund become a CDFI (Community Development Financial Institution) because of the limitation on the involvement of the public sector and because a majority of the funding cannot be public to qualify as a CDFI.
The regional housing trust fund would provide financial assistance to nonprofit and for-profit developers to support housing opportunities. The recommendation is for the regional housing trust fund to be a publicly “chartered” tax-exempt organization and to contract with the City of Milwaukee to provide administration until it is possible to hire its own staff.
The initial proposal for the regional housing trust fund was issued by the City of Milwaukee Housing Trust Fund Finance Subcommittee in May 2011.
The Southeastern Wisconsin Regional Planning Commission made a presentation in September 2011 to the Regional Housing Plan Advisory Committee, based on extensive studies which can be found online here. Necessary steps identified to create the regional housing trust fund include:
- Consideration of the proposal by the appropriate committees of the Milwaukee Common Council and the County Board,
- Secure agreement in principle to the proposal,
- Organization and incorporation of the new regional housing trust fund,
- Draft resolutions terminating the existing housing trust funds and transferring the capital (or agreements to provide capital) to the regional housing trust fund,
- Recruitment and appointment of the governing body,
- Securing staff or entering into contracts for services, and
- Securing commitments of additional capital to expand the regional housing trust fund.
On December 14, 2011 the Milwaukee Journal Sentinel issued an editorial in support of the regional trust fund proposal. And on December 17, 2011 an op-ed was printed which was submitted by Michael Murphy, Milwaukee Alderman and chair of the Milwaukee Housing Trust Fund; Cathie Madden, chair of the Finance Committee for the Milwaukee Housing Trust Fund; Jim Mathy, Milwaukee County Department of Health & Human Services, Housing Division; and Robert Dennik, senior vice-president for VJS Construction Services.
In laying out the rationale for the proposal, they conclude that: “Inter-jurisdictional collaboration is not always a simple undertaking. Collaborative efforts often confront geographic misperceptions and long-standing issues, including racial and socio-economic tensions to be successful. But with local government budgets shrinking by the year and the urgent need to develop our region’s economic potential, our communities must be courageous and thoughtful enough to recognize that what separates us is far less important than the social and economic future that binds us.”
Brian Peters of IndependenceFirst is encouraged by the discussion: “We are excited at the prospect of a regional trust fund. It is a great opportunity to expand funding for affordable housing and, as we’ve proposed it, it would help coordinate public policy efforts around affordable housing throughout the region.”
Contact: Brian Peters, IndependenceFirst, 540 South 1st Street, Milwaukee, WI 53204 (414¬291-7520) BPeters@independencefirst.org.