Opinion: Letter to the Editor: The Challenge of Sustaining Public Housing

Opinion: Letter to the Editor: The Challenge of Sustaining Public Housing

On Monday, July 10, an affordable housing advocacy coalition sent a letter to City Council protesting current plans for the redevelopment of Andrew Adkins, a public housing site in Old Town. On Thursday, July 13, Roy Priest, CEO of the Alexandria Redevelopment and Housing Authority (ARHA), sent a response (edited below) addressed to City Council and the citizens of Alexandria.

[W]e would like to reaffirm and emphasize that our motivations are aligned with those of the affordable housing advocates throughout the community and we are and remain committed to working with the City Council and staff to continue to achieve our goals of providing affordable housing to those families most in need. …

Ratio of Market Units to Lower Income Housing.

The 2014 … [Request for Proposals (RFP)] noted that proposals which could result in an overall increase in ARHA-owned units by creating additional housing for people of all income levels in order to effectively subsidize affordable units would be given preference. However, it was not the intention of the RFP to be prescriptive regarding the mix of incomes, uses, or housing types within any of the communities to be redeveloped. The intention of the RFP Process was to select partners that would engage with ARHA in an open community-facing process to successfully execute the redevelopment of ARHA owned properties by creating viable, sustainable communities. In past ARHA redevelopment efforts, this same process concluded with the following results: [23 percent of units replaced onsite and 77 percent offsite for Cameron Valley; 52 percent of units replaced onsite and 48 percent offsite for Chatham Square; 69 percent of units replaced onsite and 31 percent offsite for Old Town Commons.]

… [T]he Andrew Adkins redevelopment effort will achieve replacement of affordable units on-site and offsite via land sale proceeds generated by the creation of market-rate rental units. … Maximizing land proceeds on our most valuable property allows us to build or acquire more units for less money in other parts of the city. …

… [T]he Braddock East Master Plan (BEMP), adopted in 2008, expresses the necessity to replace some of the existing public housing units in Braddock East at other locations in the city because of the number of low income housing units in this neighborhood. … [T]he BEMP is clear that the estimates for financing of a mixed-income development and the replacement units is only an approximate measure, as changes in market conditions and funding options will affect the underlying assumptions of any analysis. This is the very analysis that is going on now and that is informing the decisions relating to where replacement units will be located, the total number of replacement units and what the affordability levels are for those units can be. As the city clearly knows, it has always been ARHA’s intention to replace one-for-one any of the units removed either back on-site or within the city limits of Alexandria.

… All redevelopment efforts have followed the recommendations of the BEMP, including the goals in the BEMP to disperse the public housing throughout the city…

… At this time, the affordability levels of the 60 units proposed to return to the Andrew Adkins site have not been determined. ARHA intends to use the value of the land sold … for the market-rate units along with Low Income Housing Tax Credit equity to pay for the one-for-one replacement of the current units without taking on debt which would require on-going interest payments. … [O]ther operating expenses cannot be offset by contributing additional equity to the project because they are on-going and will require an on-going revenue source to be sustainable. …

[D]evelopment with all units at 30 [percent] of [area median income (AMI)] is not sustainable … unless ARHA is able to secure Project-Based Vouchers (PBV) for the project. … A voucher subsidy allows a lower income family to live in the community by paying the difference in the amount that is 30 [percent] of the household’s adjusted income (tenant portion of the rent) and the contract rent (higher market-based rent). … In the Old Town Commons effort, ARHA received the [Tenant Protection Vouchers (TPVs)] but in the last phase we project-based the TPVs to assure that the subsidy was tied to the unit and not lost if the resident left the area with their TPV. Because of the timing of the process, our initial concept is modeled with TPVs, however, if changes in the current law allow us to convert these TPVs which are portable, to PBVs, we will do so. ARHA has started the discussions with its HUD Field Office but will not have a firm answer until we work through that disposition application process.

Transition Plan for Residents.

As with every redevelopment project ARHA has done, no unit will be demolished until such time that there is a replacement unit identified. The Relocation Plan is being devised methodically with the development concept plan for the site; these items necessarily need to be completed concurrently because one informs the other. …

Housing Affordability as a Citywide Priority.

… ARHA has not reversed its course and remains committed to providing housing for the most vulnerable. … What ARHA cannot do is to create a community that is not sustainable. If the operating proforma does not indicate a healthy fiscal situation, even if ARHA is able to secure the very competitive tax credits to build the community, we will not be able to sell the credits to investors to raise equity.

“Currently, [Public Housing Authorities (PHAs)] are only receiving about 70 percent of the amount HUD has determined they need to operate. … This is not specific to ARHA and Alexandria, it is the case for the entire country …

Roy Priest

CEO, Alexandria Redevelopment and Housing Authority