The City Council and the public housing authority will soon consider a revised agreement to replace demolished public housing with “substantially equivalent” units, but without prescribing maintaining rents affordable at the lowest incomes.
In 1981, the city government and the Alexandria Redevelopment and Housing Authority (ARHA) agreed not to diminish the city’s stock of 1,150 public housing units. ARHA administers federal housing programs in Alexandria, but is governed locally by a council-appointed board. The joint agreement, established in Resolution 830, requires, among things, that any demolished public housing must be “replaced by an equal number of either conventional public housing units, or … [other] publicly assisted housing units.” The latter must be “substantially equivalent to the units being replaced.”
But the two entities’ interpretations of what substantial equivalence means have diverged over the years.
The city has tended to think of substantially equivalent replacement in terms of affordability at given income levels. The replacement for a unit currently serving a household making 30 percent or less of the area median income (AMI) — about $35,000 for a family of four — would remain affordable to that (or a similar) family. Last year ARHA provided the vast majority of the city’s housing options available to that lowest income stratum, while the private housing market provided none, according to city government data.
ARHA has tended to think of substantially equivalent replacement more in terms of the number of units than of hard-and-fast levels of affordability. This view allows new units to target higher income households than the old units being replaced. ARHA leaders have long said they need this flexibility to ensure sustainable operations in a world of political and market uncertainties. They can’t commit today to replace units tomorrow at the same low rents, since low rents might not cover debt service in tomorrow’s environment of shrinking HUD subsidies and fluctuating financing conditions.
After months of negotiating new language, the two staffs’ proposed revision would “reaffirm” their shared voluntary commitment to preserve the originally agreed upon stock of 1,150 units. The revision would also enshrine ARHA’s preference for undefined affordability parameters: “The income level distributions … will be in a manner that allows ARHA … to secure financing and ensure the long-term sustainability of each project, by using income from workforce level units (greater than 60 percent AMI [about $70,000 for a family of four]) and/or market-rate units to cross-subsidize operating deficits resulting from lower income level units (less than 30 percent AMI), which is necessary to achieve a balanced income statement for each project. ARHA will ensure that the income levels proposed are the most appropriate mix and will provide the city with documentation to support its determination. The specific percentage of units in each income level will vary from project to project based on financial sustainability and the funding sources involved. … The city may provide long-term financial incentives or resources to help ARHA achieve deeper levels of affordability than proposed ….”
A council-chartered ad hoc advisory group contemplated several characteristics that might specify the meaning of substantial equivalence, none of which the proposed revision includes. In a survey last year, 81 percent of advisory group respondents said the definition of substantial equivalence should include “comparable location and/or access to transit, services, schools, jobs, amenities, etc.”; 76 percent wanted a “minimum standard of affordability,” meaning replacement units to serve the same profile of families (essentially ensuring right to return for original families who want to return);” 67 percent wanted “replacement of similar bedroom mix … unless there is justification for a departure.”
“It’s going to be a subjective call, there’s no objective criteria” for substantial equivalence, said ARHA CEO Keith Pettigrew.
“We’re trying to get to a place where we build flexibility into the resolution, but also state the direction that we intend to go,” said Mayor Justin Wilson. “What this [revision] is saying is that, basically, we are going to use higher [percent of] AMI units, as well as market [rate] units, to subsidize … the 30 [percent of AMI] and below units, and that we’ll have a balanced portfolio across the redevelopment cycle. That’s the assumption.”
A bigger step would entail crafting a new, separate but supplementary resolution with non-ARHA housing providers to preserve low-income housing options in the city, he said.
The state of affairs is “worrisome,” said Councilman John Chapman. He says the city government has always looked to ARHA, because of the federal money it receives, to provide the city’s lowest-income housing options. If ARHA is less and less able to fill that gap, “How do we as a city deal with that?” he said.
The advisory group will consider the proposed revision on or about April 11. Council will hold a public hearing on April 13 and take final action with ARHA’s board on April 23.
For more information, visit www.alexandriava.gov/Housing.
The author represented the Alexandria Housing Affordability Advisory Committee (AHAAC) on the advisory group.