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Helping Home Buyers

In discussion over Virginia Square development, County Board looks to promote affordable home ownership.

In the fight to preserve affordable housing in Arlington, much discussion has focused on rent control. But to ensure diverse housing options, county officials are looking at another piece to the puzzle — affordable home ownership.

It slipped under the radar of many affordable housing advocates, but a development proposal at the Oct. 18 County Board meeting foreshadowed upcoming debates over plans to increase affordable housing stock, including condominiums.

In a split-decision, board members narrowly approved plans for a nine-story= residential development in Virginia Square, at 1002 N. Monroe St., 1003 N. Nelson St. and 1008 N. Monroe St.

Just three speakers addressed the issue before the board, but the site plan that board members approved Saturday left a number of affordable housing issues unresolved. Instead the developer, McLean-based Madison Homes, Inc., is required to abide by an affordable homeownership policy yet to come to the board.

“We’ve got to sort out our homeownership policy,” said Board chair Paul Ferguson on Saturday. Currently, county staffers are discussing how a policy protecting affordable home ownership should be written, and board members hope to approve such a policy by the end of December.

That may be wishful thinking; County Manager Ron Carlee said Saturday that board members are unlikely to reach a consensus at all but may be able to arrive at a majority opinion by January.

ANY POLICY ON affordable home ownership must address details that make affordable home ownership more complex than affordable rentals. With rising real estate values, it will take large county subsidies to keep costs of condominiums affordable, let alone detached, single-family homes.

In 2000, 66.2 percent of U.S. households owned their home, according to U.S. Census data. In Virginia, 68.1 percent owned a home. But in Arlington, that figure was just 43.3 percent.

“We’ve gone backwards, while the homeownership rate has gone up around the country,” said Charlie Rinker, a longtime affordable housing advocate.

On Saturday, board members focused on condos. Of the 73 units in the new nine-story building, nine will be sold at prices deemed affordable for families earning 60 percent of area median income — $91,500 in 2002.

Original proposals from the developer called for eight units to be affordable, priced for those earning 80 percent of area median income, but negotiations with county staffers led to the increase in the number of condominiums, and a lower cost threshold.

FOR TWO BOARD members, negotiations didn’t go far enough, leading to a 3-2 vote for the site plan. Chris Zimmerman and Walter Tejada both voted against the rezoning and site plan after supporting creation of a special affordable housing district.

“The last thing anybody wants… is to displace people and make them homeless,” said Barbara Favola. She voted to approve the new development but expressed concern about the loss of affordable rental units. Construction of the new building will mean the loss of 17 units of affordable housing, currently rented for $750-$1,250 a month.

Zimmerman and Tejada supported the idea of protecting existing affordable rental units in the area but said the developer had not agreed to provide enough affordable units in the new building.

By-right, Madison Homes could have built 15 units on the site, but the board’s vote awarded bonus density for an additional 64. “I didn’t vote for the zoning change because I don’t believe we’re getting proper value for it,” said Zimmerman.

Catharine Puskar, an attorney for the developer, challenged Zimmerman, accusing the board member of viewing the proposal in a vacuum. The Ballston/Virginia Square Sector Plan envisioned development of this density, she said.

Zimmerman fired back that it was Puskar viewing the proposal in a vacuum, looking only at profit. Madison Homes is a for-profit developer, he said, and Puskar is paid to represent their financial interests.

ALTHOUGH UPCOMING development will provide affordable condominiums, creative financing could work out in other ways, said Rinker. At least five projects currently in planning stages will present opportunities to increase affordable homeownership and will test county policy, said Carlee.

Rinker is pushing for more opportunities for multi-family and cooperative ownership. That type of incentive can make home ownership more affordable for low- and moderate-income residents.

The real challenge, Rinker said, is to allow participants in the county program to experience the benefits of home ownership without creating unfair rewards. For instance, to make an average condominium affordable to residents earning 60 percent of area median income, the county would need to provide a subsidy of perhaps $80,000 to $90,000. But at least a portion of the subsidy could become a loan or an equity share against the home’s future appreciation, Rinker said.

County policy is also likely to seek measures to prohibit participants from renting out new homes.

Upcoming plans to promote affordable homeownership are not without precedent. Currently the county funds the Moderate Income Purchase Assistance Program, which provides loans of up to $15,000 toward the purchase of a home in Arlington.