The overarching context for the 2016-2020 DHCD Consolidated Plan is a severe affordable housing crisis in Washington D.C. We are at a critical juncture and need to make sure we are using federal funds and local funds to complement each other as we fight to prevent and eliminate homelessness, and to keep the District affordable for residents. The District has half as many low-cost units as in 2002, a loss of almost 30,000 units. Across the entire market rents have increased far faster than incomes in the same period. For those making on average $45,000 incomes rose 9 percent from 2002 to 2013 while average rent grew 44 percent.[i] For those making on average $22,000 rents rose 35 percent while income did not increase at all. Fewer and fewer affordable apartments and higher and higher rent burdens on individuals and families is the clear trend.
The distribution of our federal dollars is must be part-and-parcel of our broader use of housing resources to support District residents. With an expectation of stagnant or falling federal funding for affordable housing programs, we must be strategic with how we use these key resources.
Our most significant problem is how we leverage our local funding. There are literally hundreds of millions of dollars allocated for the next six years in General Obligation Bonds, asset sale revenue, and other sources feeding into the Capital Improvement budget, which is currently earmarked for projects like New Communities that destroy low-income housing and replace it with projects catering to the higher end of the market. There are hundreds of millions of dollars earmarked over the next several years for projects of dubious value like the streetcar, and even a modest tax increase on the highest income earners could net tens of millions in extra revenue.
If methods like this were targeted to drastically increase local funding sources, federal funding could be either bolstered in the areas it already works in or, more desirably, be used toward new creative uses.
For instance, HOME Grants, which support a range of affordable housing usages designed by localities, are often used in conjunction with the Housing Production Trust Fund to create and maintain affordable units. If all or a portion of those contributions could be replaced with local funds, federal grant money could find a use elsewhere. One example might be to support a more aggressive use of eminent domain to quickly acquire vacant and blighted properties neglected by private owners who found them unprofitable and rehab them for use to prevent homelessness, or rapidly rehouse our homeless residents.
Also, we need to make sure our laws enable us to use federal funds effectively. For instance federal loan programs like HOME or Community Development Block Grants can be, and are, used to assist tenants in buying their buildings through the First Right Purchase Assistance Program. But the fact that we allow developers to wait long periods before issuing notices to vacate for construction or demolition prevents many tenants from taking steps to exercise their rights, and effectively cheats them out of a chance to buy. Our policies are enabling “constructive eviction” – causing homelessness and displacement rather than fighting it. Clarifying the law to remove a major loophole like this would allow more tenants an opportunity to buy, and we could target our resources to support them. In addition to increased local funds, federal funds could be an additional boost to help the resulting increase of tenants seeking to exercise their rights and remain in their housing.
DHCD should be working together with other departments in the administration and with the D.C. Council to secure commitments to a holistic executive and legislative strategy to facilitate changes like these. Without that the dispersal of federal funds for affordable housing and community development will be limited in their potential impact, and be insufficient to combat the current growing crisis in housing affordability.