Multifaceted approach the best way to create more affordable homes
The lack of affordable housing in our state is something that affects all of us, regardless of where we live. Neighborhoods across Oahu are feeling the effects of escalating housing costs. Our city's success or failure in dealing with the affordable housing crisis, and resulting homelessness, rests upon taking a proactive stance rather than a purely reactive one. We believe the City Council has the ability to make a difference on this issue and here's why.
Oahu residents sent a clear message that they wanted to change the status quo on affordable housing when they approved City Charter Amendment 3 last November. This amendment designates that a minimum of 1 percent of real property tax revenues would be placed in two special funds, one of which would be known as the Affordable Housing Fund.
We, as elected city officials, were given a mandate to find ways of alleviating the burden of high housing costs for individuals and families earning less than 50 percent of the median household income in the city. We believe the city can be more responsible in setting policy that encourages and preserves affordable housing on Oahu. To do this, we must address affordable housing on multiple levels, building upon what's currently working well in our city while we also explore new possibilities.
Over the next several months, through a series of legislative measures, we hope to stimulate renewed dialogue about the city's role in affordable housing. Here is what we propose:
» Put monies in the Affordable Housing Fund (AHF) to work; we must encourage local businesses and nonprofits to take advantage of these monies to develop new affordable housing projects on Oahu. These monies can be used by established businesses but also act as seed money for new entities willing to look at affordable housing in different ways.
In 2006, the City Council passed Resolution 06-031, which asked the city administration to identify city lands available and suitable for affordable housing development. Such land could be developed in part as a community land trust similar to the Homestead Community Land Trust in Seattle. Such a trust could utilize monies from the AHF to acquire additional land but also provide funding for housing upon that land which would remain part of the trust in perpetuity.
These properties could serve as "labs" for developing new approaches to affordable housing in Hawaii. We have an untapped crop of motivated and innovative engineers, architects, cultural practitioners and community activists who have the ability, and the will, to address housing from a multidisciplinary approach.
» Mandate a higher percentage of affordable units for new residential developments seeking a zone change. In addition, we need to ensure that once built, these units remain affordable. This is a serious impediment to the availability of affordable units over time; once constructed, the city should require that those purchased affordable units remain affordable for at least 30 years, rentals for 45 years. Should units be resold, they must do so at an affordable rate.
» Create a "density bonus" allowing developers to build an additional 10 percent of units in exchange for adding affordable units to new residential developments. This has been one of the most effective methods in other metropolitan areas to stimulate growth of the affordable housing market.
» Propose a limit on real property tax increases for properties designated as long-term affordable rentals. Bill 41 was introduced before the City Council to provide a tax break to property owners maintaining rentals at affordable rates for the long term, thus helping to maintain the number of affordable units available on Oahu.
We also propose giving a real property tax break to qualified owners of affordable rental housing by offering an affordable rental housing exemption up to $80,000. Additional incentives for developers of affordable units, as covered under unilateral agreements or otherwise, include waiving sewer and water fees, waiving building permit fees, and/or fast track permitting.
» Set a policy for the city that discourages developers from opting out of constructing affordable units by paying "in-lieu fees." All in-lieu fees currently being collected also will be directed into the Affordable Housing Fund with the expressed purpose of encouraging the building, maintenance and acquisition of affordable housing.
» Urge the administration to adopt the recommendations of the mayor's task force on affordable housing completed in April 2006, including the hiring of a special assistant on affordable housing.
These initiatives, together with other proposals dealing with affordable housing, are critical as Honolulu proceeds with plans for a new mass transit system. The effect of mass transit will potentially transform Honolulu's urban core unlike any project in the city's history. The City Council has in the past looked at transit oriented development as one way to structure this growth and encourage smart mixed-use development. It will be imperative that affordable housing be central to any future TOD plans.
Coupled with this expected growth should be requirements that affordable housing meet LEED (Leadership in Energy and Environmental Design) standards and other eco-smart specifications, which will help new homeowners decrease their housing maintenance costs while lessening the pressure on already strained natural resources.
While there is no silver bullet for ending the affordable housing crunch on Oahu, we believe this package of legislation could provide serious relief. Success of these and other proposals will require buy-in from local industry, and therefore we welcome input from the representatives of the building industry, the nonprofit community, community/neighborhood organizations, and others concerned with this issue.
Honolulu's City Council has been charged with taking an active role in the affordable housing equation. It's a complicated formula that will require continued cooperation between public and private entities to improve Oahu's housing crunch. The affordable housing crisis should not be an inherited problem from year to year. It's time for the city to put plans in place for real change.
Donovan M. Dela Cruz represents District II and Ann Kobayashi represents District V in the Honolulu City Council.