Housing Advisory Committee Meeting   5/19/2021

Okay.

It's five minutes after 12, so I'm going to go ahead and call this meeting to order.

This is the regular monthly City of Charlottesville Housing Advisory Committee meeting, which will also contain within it a meeting of the Policy Subcommittee, which will compose a bulk of the meeting today.

I do note by eye that there are at least 10 voting members of the hack present, so unless there is an objection, I would like to declare a quorum.

Hearing no objection, I'm declaring a quorum.

Done.

Welcome all.

We do have a couple of guest presenters who have parachuted in and a new member or two.

So I think it might benefit us first thing off the bat to at least go around and do some quick introductions.

And then we can move forward with a review of the minutes and getting the meeting proper started.

So I'll start with me.

My name is Phil d'Oronzio.

I am the chair of the HAC.

I am the banker rep appointed by council.

And my day job is as the CEO pilot mortgage.

Or do no one in particular?

Hello.

Lyle Solie-Yates, vice chair of the HAC, also vice chair of the Planning Commission for Charlottesville, a man about town, city resident.

Great.

Great.

I am Ridge Schuyler.

Welcome.

I'm Dan Rosensweig.

I'm the President and CEO of Habitat for Humanity of Greater Charlottesville.

Great.

Thank you, sir.

Hi, everyone.

Russell Ray.

Go by Joe.

Either is fine.

Hi.

I'm Joy Johnson.

How are you, Joy?

I'm Joy Johnson.

It is indeed.

Great.

Alice.

Good afternoon, everyone.

Alice Rauscher.

Welcome.

We're very happy to have you.

Taking myself off mute.

Where are we?

Thank you, sir.

I think Alex, you're up.

Good afternoon, everybody.

Alex C.K.

Funa, City of Charlottesville, NDS.

Michael.

Good afternoon, everyone.

My name is John Sales.

Thank you.

I think I've covered those folks.

And then we were also joined by Jeff Davis and

Jason Vandiver, who are here to present, make a presentation.

No problem.

Good.

Hi, everyone.

Welcome, all of you.

Again, we had new faces.

Alice Rauscher joining us from the university, among others.

I'm glad to have all of you here.

We have minutes.

If we could, someone could take a quick view with the minutes.

Great.

Is there any discussion?

I would note that if we can amend it to correct the spelling of my name, I will third it and call a vote.

All in favor?

Aye.

Aye.

Aye.

Any opposed?

Great, moving on.

So before we get to the meat of the matter and to Jeff and Jason's presentation and our discussion thereof, wanted to see if there's a quick city update.

Looks like we've had a couple of action items.

Well,

Good afternoon again.

The only thing I need to add, it's our comprehensive plan process for which you folks are part of.

It's continued to move forward.

We're going through the engagement process right now, especially with the land use and other chapters.

But the land use seems to be receiving a lot of attention, you know, community wide.

It's on the website.

The Futureland Use Map, the feedback, it's open till May 30th.

We had a very busy weekend with community pop-ups around the city on Saturday, Sunday, and even on Friday, this past Friday through Sunday.

A lot of feedback, a lot of engagement with folks stopping by the sites.

and having discussion with the consultant and staff.

We are looking at an update with the Planning Commission on the 29th of June.

And subsequent after that, we make corrections and we have a regular meeting with the Planning Commission.

And we are also planning our update to the City Council

and after which we start looking to have some kind of public hearing with council and planning commission and subsequently some form of action by the planning commission and city council.

And then we move into the final phase of the project which is a comprehensive zoning rewrite.

Again, folks can go to the website, the project website, SeverePlansTogether.com and provide feedback.

If you send email, you will get a response back from the consultants.

That's where we are right now.

Also, on Monday, the city council approved an amended agreement to extend the CSRAP program.

And John Sales had asked that the city council also approve increasing the fair market rental rates that are currently controlled by HUD limits, which they did to 125% for city resident vouchers.

Also looked like the CHAP program had its first reading as well.

Can I ask a question of John?

John, are you available about the CSRAP program?

Yes.

So the increase to 125%, was that because we're still having trouble having vouchers absorbed?

I think it's a mixture of both.

So we are continuing to see that most families are going out to 180 days to lease up a unit.

because they can't find a unit that's affordable in this city.

And it requires a 90-day search inside of the city to lease up a unit outside in the county.

Thank you.

Thanks for continuing to steward that.

I did read in the paper that one of your questions to counsel was the idea of transition, of making the vouchers a little bit more dynamic, which is something that we talked about as we were originally putting together the policy.

So I just wanted to let you and Brenda,

Yeah, that was one of the last minute ones that I said, hey, we do need to figure that out.

And another piece is like time limits if they're going to be time limits.

Otherwise, a lot of the families are not moving out of the program to open it up.

I mean the waitlist

has been stagnant and we're not assisting any of those families.

And that's at 122.

So, the federal program continues to add money in and other ways to fund more vouchers, like last year, the housing authority received 40 mainstream, we were just awarded an additional

15 emergency housing vouchers, then we received a large sum of money that we also put back and added more vouchers to the street to get us closer to our cap.

And the city program just isn't getting there.

John, question for you there.

And this is probably something that the subcommittee should take up at another meeting.

But as originally conceived in the HAC, we had the idea that this supplemental folks who were already on the federal waiting list wouldn't lose their spot.

by taking a CISRAP voucher.

So the idea being that should the Fed program add and expand, folks as they move to the top of that list could move off of CISRAP bit by bit.

Do you have tracking for that?

Oh, we've completely cleared the HCV waitlist.

So some families didn't want to move off of the program.

Some parent families no longer qualified.

And so there's actually only seven individuals that are getting assisted that were originally on a HCV waitlist.

that are no longer on the HCV waitlist because we cleared that list at the end of last year and opened a new one in I think February or January.

I think we had two of them.

I can pull that information, but I think it was only two.

Yeah, that's, I mean, one of the things about this was it was something of a pilot and we're gonna try to see, figure out what worked and how and what sort of adjustments we need to make.

So anyway, it's a good thing for us to take a look at and we'll be happy to do that a bit later in the, as we have to reconstruct and move that program to the next level.

Thanks.

So the advertisement for the position has been put on hold until we get our deputy city manager of operations included in that process.

Oh, so the whole process is starting over again.

Yes.

So we're working on it.

10 months at this point.

All right, so the

The main bulk of this meeting is a policy subcommittee meeting, a sort of play within a play, if you will.

So regarding the, at the request of the city treasurer for a tax abatement plan for rehab of properties and how that fits, doesn't, should, shouldn't into the overall housing plan of the city.

and the treasurer asked us to take a look at this in anticipation of reauthorizing the program later in the year to city council.

So what I'd like to do is ask the policy subcommittee chairs to lead that discussion and start with sort of an overview of the program from our folks and then sort of move into a discussion of it.

The underlying ordinance and the underlying piece of the code of Virginia that is applicable was distributed by a link to you all over the weekend.

I hope you've had an opportunity to look at that along with sort of a

a spreadsheet sort of.

So if you've got those materials, you may wanna drag them out now without.

So, and I'll sort of turn this over to Dan and Ridge or play within a play, I guess, Paramus and Thispy.

Well, I'll go ahead Dan and convene the policy subcommittee and welcome all of you.

I would like to first of all thank Jason and Jeff for bringing this to the housing advisory committee.

I appreciate the initiative and helping us or engaging us to help you think through whether or not this incentive program that was created by statute and implemented by the city is consistent with the current housing policy goals and

I'm going to ask Jason and Jeff to go over how the program has been working since 2012.

I would love the Policy Subcommittee and others who are participating to hear what is being said with an ear toward how does this incentive program fit into our housing goals?

What should be the objective of this incentive program?

and how should we recommend to city council if they do decide to reauthorize potential changes to it to make sure that it is advancing goals that we have as a city to meet our housing objectives.

And so unless there are, Dan, unless you have other introductory remarks, I'm gonna just open it up to the experts and have them walk us through the program, what it has accomplished so far, what have been the,

effects of the program.

And then we can open it up to just a spitballing session about what the goals of this incentive program ought to be going forward.

Sure.

Yeah, I can go ahead and get us started.

Thanks for that introduction.

I think you kind of nailed it on the head with some of the questions that we had.

This program has been around for quite a while.

and as far as we can tell has not gone under any significant review since its inception.

And I think we have the same questions that you do of whether this incentive program, which at its base level provides the tax incentive for either rehabbing or renovating existing property in the city where somebody could do improvements to their property.

And then for seven years following that they essentially

get a partial tax exemption based on the change in value in that structure.

And so we, you know, we're wondering whether this is a program that matches the city's housing goals.

Is it encouraging the same goals that the city has, or in some cases, possibly running counter to those goals?

And so we appreciate your willingness to take a look at this.

But kind of the basic, the program parameters, which I can go over

So, you know, say for example, somebody would like to either rehab or renovate or even add an addition to their property, they would apply for a building permit.

They would concurrently apply with the assessor's office for the tax abatement program.

Jeff's office would send one of the assessors out to do a base assessment prior to construction.

And then when the construction is completed,

Jeff's office would send somebody out to do a post-construction assessment and that change in value then is abated for seven years.

So after that seven-year period runs its course, assuming the property remains owner-occupied, the full value would then become taxable.

So that's kind of the basic structure.

I think

If you had a chance to look at the city ordinance and the state code authorizing the program, the state code is certainly more broad and provides more levers than the city's program does.

And so I think that might be something that I would point you to as you're looking at this.

Is there a way that perhaps we could use some of the other authority granted under the state code that's not currently in the city code to help

encourage the kind of development that you would like to see and perhaps discourage the kind of development that you don't want to see because there are different ways the program can be constructed and you know 20 years ago the city came up with a way and it's been that way ever since so I think generally the the question that we would have is if if you could rewrite it and reauthorize the program in a way that you would like to how would you do that and how would you like to see the program continued and so

We provided a lot of information on the spreadsheets.

That's all of the information that we had for the last 10 years.

It may be more than you need, but it's all there.

And I think you can see that over the years, both the beginning value, the increase in value, and the final value for homes that have taken advantage of the program have gone up dramatically.

And so that's larger homes taking advantage of the program, completing larger additions, larger improvements.

And so I think that's one thing that we noticed, especially over the past few years that we were hoping you could take a look at and just see whether, is there a way that it could be rewritten to help accomplish your goals and the city's goals?

So with that, I will open it up and Jeff can correct me if I made any errors or omissions there, but

I think you pretty much covered it, Jason.

This is Sunshine Mathon at Piedmont Housing.

I was actually unable to open some of the documents, including the spreadsheet.

I'm not really 100% sure why.

So I was wondering if

Sure.

So yeah, the spreadsheet contains just various ways that we kind of, you know, slice and dice the data, I would say on average, about 20 properties a year take advantage of the program.

And so

There obviously are more renovations occurring in the city than that.

And so I think part of that is just people aren't aware of the program or they become aware of it after they've started construction and then it's too late to apply.

I think as well, one of the key components, the property has to be older than 25 years.

You have to increase the value of the property at least 15%.

And so some people don't meet either one of those guidelines.

I think,

Trying to think of what else is of note there.

It has to be owner occupied.

So if somebody who's flipping a property wouldn't be able to qualify for the program, if they move out after one year and start renting the house out, the abatement would expire until they move back in.

Also, if they become delinquent on their taxes, they wouldn't qualify anymore.

So over the years, somebody might drop in and out of the program.

You can sell it, and the new owner could still qualify for the

for the abatement if they lived in the property.

But I think that we found over the last 10 years reviewing that data, about 80% of the applicants, the improved value was less than 150,000.

But that does mean that about 20% of those who qualify are creating an improved value change of over $150,000, which potentially is not

where the city would like to see that.

Somebody, for example, purchased a property for $300,000.

There's no cap on the amount that they could improve the value of that property and receive a tax abatement currently under city code.

And Sunshine, let me jump in here, please, because I have the spreadsheet.

pulled up on my screen.

One of the things that that was interesting to me was, you know, if you think of a tax abatement program as revenue foregone, you know, what is the city spending on the program?

And if I understand the spreadsheet correctly, it's been about just less than $210,000 since 2012.

That has that is revenue foregone by people who have participated in the program.

So if we're thinking about

This in terms of expenditure of city dollars in order to address our housing ecosystem, a kind of initial question is, is this a good use of $209,000 as currently constructed?

Or could we maneuver this incentive program so that that kind of money would go towards some objective that we all hold dear where an incentive program is the best opportunity

to get that done, but just to give you some sense of scale of cost.

And that ends up being about $20,000, well, less than $30,000 a year for the incentive program, if I read the spreadsheet correctly.

Yeah, just to clarify, since a property stays in for seven years, each year you have about $15,000 to $20,000 qualifying for the abatement.

I see.

So I wasn't reading it correctly.

So my question is over, for example, the folks entering for 2020, the number, it looks like it's $35,000 in actual tax abatement

in terms of revenue starting that year and presumably every year $35,000 for those folks.

So that works out at our current mill rate to something like $3.7 million in value that we're sort of exempting or abating from tax, right?

and more or less, do I have that right, at 95 cents?

That's correct.

Okay.

And we've got, it looks to me 19 participants who jumped in that pool as of last year.

So, but at 13,000, I mean, let's see this, 13,000, 35,000 divided by 19 is a little over,

1800 bucks a household, you can buy that by 12, you're at about 150, 254 bucks a month in savings, assuming you've got a mortgage with an escrow on it.

So from sort of the affordability side, it's just sort of eyeballing this, this isn't really an affordable housing programme in the sense that the people it's saving that money to based on the assessed values,

Right, well, the top figure now to apply for the program is $694,000.

Anything over that, you would not be eligible to qualify for the program.

That's the initial.

Right.

And I'm going to call on Chris.

But just to note, I mean, the thrust of the statute is obviously focused on older properties.

And that's kind of the triggering event is if you have an older property.

And if I'm not mistaken, it's not just renovated, but it could be replaced.

Right?

So at least under the statute, replacement is an option in order to qualify for an abatement.

And so it wasn't set out to be an affordable housing thing.

It appears to me the statute was, at least in broad strokes, set out to say, hey, you've got older homes in your community.

You can pass an ordinance that could fix them up, replace them.

and a fair amount of leeway for cities about how to craft their ordinance.

And I think that gives us a fair amount of leeway to say, okay, if the target is older homes in our city, what incentive would we like to create with regard to those older homes to achieve some kind of objective that we have as a community?

Thanks Rich.

Just a clarification.

I think I read the city ordinance and the original ordinance, I think it was included in our meeting packet and it had the max value land and improvements was $506,000.

Is that, was that tied to some kind of inflation?

Cause what I saw now though, and looking at the numbers also in the spreadsheet is

In 2021, there were multiple houses that were qualifying for this above the $506,000 initial assessment.

That cap has increased based on the amount of the residential assessment increase on an annual basis.

So each year that the amount of the abatement or the limit on the abatement was increased based on the

the amount that residential properties increased.

Greg, somehow that annual increase or

It just doesn't seem like it seems like it's a hard cap.

The most recent ones done.

One example is an initial value of six hundred three thousand dollars and the increase in value is nine hundred thousand dollars.

So now that the home is now assessed at one point five million, I don't think we need to be subsidizing that type of case.

And that's

what $9,000 or $8,000 a year of tax abatement for that household.

However, you know, the ones that are much smaller, there's the other examples of, you know, something that's $132,000, you know, and only $17,000 of abatement.

Those are the type of, you know, I think, obviously projects.

I would, you know, from a observation point here is right.

I mean, I would have

I mean, I think I want to bring one more data point up from the spreadsheet and then we can start throwing around ideas.

What I would love is if you have specific thoughts like the one Chris just had,

It would be really helpful, I think, to the group to say, what goal is it that your suggestion would have us achieve?

So you could have a goal of, we want to maintain our older housing properties because they add character to the city.

And therefore, we should focus on this part of the plan.

And or we could say, Oh, no, no, we want, we would like the program to create incentives for more affordable housing.

and that might lead us to a different set of recommendations.

And so it'd be very helpful to at least articulate what we think the goal of this incentive program ought to be.

Then we can talk about ways that we might imagine to reach those goals.

And I'm imagining that we would have a little bit of a work group that would throw some recommendations around that would really get at achieving those goals.

What I would love to come out of this meeting today with a firmer understanding is what goals do we think this program ought to achieve?

Corey, I saw you with your hand up.

I just want to raise one issue regarding affordability that came out of the data and then I'll open it up again.

So if I, again, understand the spreadsheet accurately, I'm looking at the home values tab on the spreadsheet, but it looks like, you know, you all compared the value of the house in terms of units pre at base value and then post rehab value.

And if I'm looking at this right, you know,

For houses where the base value was between $100,000 and $150,000, there were 31 units, houses in that category pre-rehab.

But after the rehabs were done, they moved out of that category so that there were only 15 houses with that base value once the rehab was done.

So because of the rehab, the houses went from being

within the $100,000 and $150,000 price range to being something beyond that, which was 107% decrease in the number of homes that were in that $100,000 and $150,000 range.

On the one hand, the incentive is having its quote, unquote, desired effect, which is that improvements are happening and values are going up.

On the other hand, values going up means that affordability is being lost in the transition.

I just wanted to raise that and now

Thanks Rich.

You know, somebody mentioned that it wasn't really an affordable housing program if the abatement's for a $600,000 house.

When we're doing rehabs at AHIP, whether we're using public money, be it home or CDBG or city calf money, CIP or a private foundation donations, we're helping all of our clients.

enter into this program and get the tax abatement for their property for the increased value of the rehab.

I don't know if it's possible to get a list of some of these properties, the physical address that we could maybe cross reference against AHIP's work to see how many of these properties, especially these ones on the lower end, 100,000, 150, just to see if these houses wouldn't have been entered into this program if it wasn't for the work that we were doing or that other organizations are doing.

because I'm wondering how many low income folks that have these current affordable houses are able to afford this work on their own.

Thank you, Corey.

Thanks Rich, appreciate it.

And thank you, Jason and Jeff.

I want to echo Ridge's gratitude for bringing this to us.

This is exactly what we exist to do and really appreciate you thinking about a policy that has been on the books for a while, but sort of rethinking it based on where the city has moved in terms of intention over the years.

And that's the germ of great public policy, so thank you.

I had a couple of questions.

This has to do with Ridge's question about, you know, what are we trying to accomplish here?

And I'm looking at the enabling legislation.

I apologize is the first time I've actually seen it.

So I haven't absorbed it deeply, but it seems to me that the original intention had a number of objectives, anti blight, home ownership, making sure that there's owner occupancy through the city,

and to a certain degree historical preservation.

I think that that's mostly it.

I think there was a concern about aging homes and rehabilitating them so that they could maintain a livable status

You know, it was a while ago.

So one of the things, I appreciate that.

Thanks, Jason.

No, I think that was the answer I would have.

Yes, I think one of the things that we probably ought to do as we're looking at policy recommendations is to see if it's worked.

Let's look at the percentage of blighted

structures.

Let's look at the percentage from ownership and see whether we whether there's a quantifiable measurable impact on the number of structures that are still derelict or in substandard condition.

The second thing I would say is that I do think that with regard to the housing ecosystem, the city has been pretty clear in terms of where it wants to focus its resources.

And we have data to back that up.

And so I'm

So I'll say a couple of things that may appear contradictory.

And this also probably contradicts Chris, Chris's initial impression.

And I'm saying this out loud, but I'm not sure that ultimately, this is policy that I would get behind.

But when you look at the RC Elko report of I think it was 2016, that they identified two sectors in the housing market that are that are drastically underserved, where there's undersupply

relative to demand.

And ironically, it was the barbell effect.

It was on both ends of the affordability spectrum.

In other words, there's almost nothing available for somebody at 30% and below their immediate income.

And also the people well above 120% of their immediate income.

In short, there are no million dollar condos and houses for people to occupy.

So what does that do?

People pay less than they can afford, and they push into the middle income sectors and create price inventory squeezes there as well.

So I don't want to throw out that idea that this could be a tool that actually helps create and maintain some of the upper end homes that are part of a functional housing ladder.

I'm not sure that's where we wanna prioritize, but I think it's something we don't wanna just assume without thinking about it that it doesn't solve problems across the housing spectrum.

The second thing I would say is that with regard to objectives, I think one of the hardest nuts for us to crack is displacement of people who are in naturally occurring, but probably substandard rental housing.

right now.

And if this could be an incentive, and this is where I go back to the enabling legislation, I don't know whether that objective is enough baked into the enabling legislation to tweak our own ordinance to solve that.

But it seems to me that one of the big challenges is, one of the tools that we typically apply to slum landlords is code compliance.

but that ends up being ultimately destructive for low-income renters because when somebody fixes up their house then the people who are afforded can't afford it anymore.

And so it strikes me as that this may be a tool that begins to address that whereas the tax abatement is in return if it's possible for either nondisplacement

or long-term or some form of deed restriction, seven year, 10 year, whatever affordability.

And then the last thing I would say is I don't know whether a hundred, whether again, without being steeped in the enabling legislation where whether some of that abatement, whether that abatement could be split perhaps 50% to the home

Oner, and 50% goes into the CAF.

I can

I want to sort of piggyback on some of Dan and I will try to be respectful of Ridge's intent to say how does this point to our goals and how can we make the implication.

I'm not clear from the enabling legislation whether it restricts it to single unit owner-occupied.

The city code certainly does, but the state I don't think does that at all.

And secondly, since we are now enabled to develop our own affordable housing plan without having to mimic the state model and we're sort of footloose and fancy-free there, that may not be restrictive anyway.

So it occurs to me that the current occupancy restriction may not be

particularly if we're gonna be zoning to allow for higher density, that this may be able to dovetail in a way to provide two, three and four unit rehabs with tying it to affordability in the tenancy that where we can expand this beyond seven years for that purpose.

And then, you know,

Yep, thank you, Phil.

I see Dan has to go.

If you all want to jump into the conversation, I would just ask you to just turn off your mute button, and I'll call on you as I see you pop up.

I see that Sunshine has been waiting, and I believe S Lisa had her microphone on for a second, so I'll call to Sunshine, and then S Lisa, if you want to go next, you can go after that if you still have something you want to add.

Thanks.

So I have a lot of, I mean, we've had a lot of ideas kind of put out there and I have a lot of cascading comments.

I'll try to keep them kind of focused.

Presumably based, I was able to open the spreadsheet and based on the data that I see in there, I did not see any demographic information other than just the simple valuation of

The homes themselves and then there's a map, an abatement location map that kind of highlights the heat zones.

With that in mind, regardless of the outcome of where the program goes, I think we all know, and this is a push that in every data collection path forward and at the state level or the city level, the demographic information has to be collected.

We have to know how we are doing

by race.

Because, you know, we know the home ownership rate in Charlottesville for black households is down in the low to mid 20% compared to nearly double that for white households or more than that for white households.

And so, assuming that the enabling legislation does not prohibit collecting demographic data,

I think that's a critical piece to it.

And then the second related to that is otherwise we end up dealing with proxies as opposed to real data.

And the proxies are always estimations and oftentimes provide room for miscalculation.

So demographic information, not only in terms of race, but also in terms of household income.

And I do wonder, and again, I'm not steeped in the enabling legislation,

but as long as it does not prohibit it, I would also recommend that the future structure of a program, there's no reason why we, unless the enabling legislation prohibits it, set an income level threshold for eligibility for the program.

It is allowed.

It's a fairly broad statute.

I mean, for our purposes, as a Dillon rule state,

So with that in mind, I would strongly recommend that there is an income threshold set for eligibility to the program in the future and that secondarily there's also, and I'm not quite sure how this complexity gets navigated, but also the

something about how much there's a cap on the renovation value.

On some level, looking at a $600,000 house with an $800,000 improvement, that would have happened no matter what.

With this program, like there's nothing, nothing doesn't change the numbers for them.

And so therefore does not provide any direct benefit to the city or any public benefit.

and just in fact is a public detriment because we lose tax generation.

So from my perspective, if this is going to be a program that furthers the city goals, it needs to be targeted to certain households, ideally by income level.

I recognize we can't target it by race, but we can target it by income level.

And then secondarily,

In my mind, we might wanna consider the idea of a sort of an additionality component, which is for projects that might not happen otherwise because of a person's income or whatever the situation is.

And this is a game changer for kind of tipping that threshold.

I think that's an idea worth considering.

And the idea that Corey had about cross comparing AHIPs data versus this data

A lot of the work that AHIP does goes into things that will not show up in a tax increase or an increase in value because they're doing repairs to the roof, repairs, things that are not necessarily going to improve the value overall.

I think we have to be careful and thoughtful about how we characterize and what we

Is there some sort of threshold for maximum amount of dollars that can be offset?

Because if we can do that, I think we can then hone in on serving those folks who can be most benefited from this and that ideally also don't pull that lower cost housing stock out of affordability for other households in the future.

And Sunshine, would it be fair to say that the goal that you're talking about that this incentive program should promote is it should be an incentive, which means inducing people to do something they wouldn't otherwise do, that's focused on allowing low income homeowners to improve the value of their properties and help them afford

what would have been the otherwise increase in their property taxes help them afford that improvement over time.

Absolutely.

And just to put a finer point on that,

I think that sort of dovetails frankly with the occupancy issue and the values here.

I mean,

One argument one could make, particularly if we're increasing density, is that if we're putting forth as part of our plan sort of a

push towards two, three and four unit property and increasing density that you can have a reasonably substantial single family residence and part of the conversion in the rehab, you could tie this abatement to an affordability on the units could generate for a period of time.

And that might be with higher values involved, but you're not necessarily I mean, there are more there may be ways to

insert this program and have it synergized with other programs we have.

That being one example, lengthening the time would help on that, too, to encourage existing single family structures for conversion that need substantial work.

If you tie that to the affordability of the units for a period of time, you

and there might be ways again to coordinate it with other existing programs.

Your point about rehabbing a lower, sort of a lower value and lower income residents house, I mean, we would clearly, the inbound funds for the rehab itself would come from some other program, right?

Because you don't have 50, 60, 70, $80,000 to do that rehab.

and now you get the benefit of the rehab and you don't get sort of jackpotted by the increased assessment.

Again, how that coordinates with the CHAP program too.

I think that we've got these semi-siloed programs and part of the implementation of an affordable housing plan really needs to look at these and see how they can be tweaked

So thank you, Phil.

As an administrative note, let me note that if you're raising your hand, if you're a host, you can see that.

But if you're a regular participant, I don't think you can.

So if you're raising your hand in the app.

I'm glad to have an opportunity to jump in here.

When I was reading the material over the weekend, stop laughing Ridge.

When I was reading the material over the weekend, I was thinking, you know, are we working ourselves out of affordability through this program?

That was one of the things that came to me.

And also I wondered about equity.

Where is the equity?

Where's the data that shows that we're being equitable about this?

Because it seems like the people who should most benefit from this is nowhere in this conversation.

I didn't see addresses, I didn't see the demographic information, and I definitely didn't see income tied to any of this.

So to echo some of what Sunshine was saying, it raised some flags for me, and I would definitely like to see this program benefit affordable housing and those who, in some kind of way, we could figure out how individuals who have these homes who would otherwise qualify but can't afford to do the work.

and who would truly benefit from the tax abatement.

That's what I would like to see to come out of this program.

Focus on our goals and the city's goals around affordable housing.

I think that all would see a benefit in it and not just the upper echelon, which I think who is quite honestly benefiting a lot through this program.

And I don't think that that was the true intent for that.

I may be wrong, but I'm thinking that it wasn't.

Thank you.

Even if it was the original intent, so what?

That was 21 years ago.

So let's, I mean, I'm agreeing with you.

So what if the original goal was to benefit, you know, rehabbing beautiful stately homes?

Well, I would say thank God we're in a different place today.

And I think the great thing here is that the statute is written broadly enough that we can reimagine this incentive program and have it reach the goals, which is why I appreciate Jason and Jeff bringing this to our attention, which is this is just another tool in our toolbox to try to get to these goals that have eluded us for so long with a focus on affordability, equity, et cetera.

And often the underlying statute is too restrictive to let you do what needs to be done.

In this case, at least by my reading, it's fairly broad.

And so we can develop recommendations for this program to focus it more narrowly on the goals that we're trying to achieve as a hack and as a community.

So that's the good news.

Other, just one note about the statute.

So you know, the statute clearly mentions the use of this abatement for multifamily.

So that's, that's definitely allowable within the statute.

The statute also mentions the possibility that a community might want to focus this incentive on certain zones.

And so just another thing to be thinking in your mind is, you know, are there communities or pockets of neighborhoods

where we would like to see older homes maintained, rehabbed to maintain a character in a particular neighborhood because if that is an ancillary goal of our housing plan, this statute clearly allows for that.

So what was going in my mind was, Corey, to you and AHIP, your block by block program

You know, this could provide, you know, provide an incentive for such a block by block program if that was the desire of the HAC or the city council.

So just wanted to put that note in there.

That is, it is one of the things mentioned as a possibility within the statute that we could also consider.

And so we could, you know, have an ordinance that does two things.

It could promote affordability through the mechanisms that we discussed earlier.

It could also

You know, focus on helping folks in a particular neighborhood who are trying to maintain their homes but can't either afford the rehab or if they could, they couldn't afford the resulting property taxes that would come along with the improvement.

So just another thing for you all to toss around in your very wide brains.

Okay, thank you for doing that.

Just take the floor again, sorry, one last time to put a little bit more.

You asked your question after I jumped in first, you know, things going, but

I do hope that the program, basically overarching goals for me would do, and others have really, I think, said this, but to maintain kind of the affordable housing stock we do have and help those at the lower and minimum income levels, basically, again, afford housing.

So I think there should be caps on existing assessment levels, the amount of, again, abatement allowed, et cetera, to make sure we're, again,

addressing those points.

Those would be the goals I would like to see in the program.

Finally, I said there is an interesting map in the data also.

I don't know if people saw that, but a lot of it, again, seems to be targeting the heat map in the north downtown Locust Grove area, if I understood correctly, which, again, is kind of the geographical focus strategies I mentioned.

I do like the idea of also kind of having

overlay of neighborhoods we're targeting, you know, again, whether it be the Rich Street area or Fifeville or 10th and Page, etc., to assist those neighborhoods.

Thank you.

Lyle, I see that you've got your hand raised.

I do.

Hello.

So, this is potentially very exciting because we've got the affordable housing plan we've got the future land use map up.

So this could be a way to, you know, shape money on the map, which is huge, because we've got big changes on the map.

We're trying to encourage more affordable homes in higher opportunity areas where it traditionally works to prevent those Which is a big shift and you know, there's no finances to support that yet This is that's something that we could do is to actually actively support the most comprehensive plan with this program So specifically high opportunity higher income areas the I'd like to see

displacement prevention for low income homeowners, but also provision of affordable housing on existing homes, especially in what was the word like, like I say, a historic home on a big lot could be a very exciting place.

I don't know that that can work that way because having those affordable homes on site would help to pay the mortgage on the property, but not clear on that.

Instead of making this an opt-in, make it an opt-out.

Make it standard for people to be a part of the program and if they don't want to, make that possible.

So just to clarify on that, you're saying that at the time you apply for the building permit, there's some sort of qualification where it's, oh, is this building 25 years old or older?

Yes or no.

Are you going to be doing x percentage of its current assessed value in improvements?

Yes or no.

OK, you're probably going to can slide into this program.

Let's figure it out from there instead of having to instead of someone having to launch themselves from a standing start.

Yeah, can't just be experts.

Yeah, that seems to be something that could be administratively fiddled with pretty easily.

It seems like we've got a whole panoply of things that need a second, third, and fourth look and some sort of integration.

And I think our original intent was to get a grip on the basics of this and then plan to have a work session where we really sort of started

doing some serious spade work here and figuring out what's what.

So I'm looking forward to that.

And thank you for that.

And that was certainly our anticipation is that we would have a subsequent policy committee.

We were all invited to it to actually work through some of these details.

I want to just say two things about Lyle's comments, and then we can

and I'll call on Sunshine next.

But one interesting idea is for the low income homeowner, I would want to think hard about whether we're going to limit the amount of improvement they can gain, because I would like to see some wealth creation, which is always a tension with maintaining affordability.

But if you're a low income homeowner and you improve your home, I'm not so sure I would want to place a cap on the value of the home as improved.

if that low income person is then able to take the benefit of that home ownership and build some wealth for themselves and their families.

And again, it is a tension with maintaining affordability, but I think it's something that we should look at in more depth during the policy meeting.

The other thing I will say is just again, looking at the statute, it appears that it would allow what Phil hinted at and what Lyle kind of touched on was replacing an older home on a large lot

with multifamily affordable units.

And we could build that into the ordinance that says if you replace an older home with affordable multifamily, then you get a tax abatement as another incentive for doing that.

And it looks to me like the statute would allow for such a program which would fit in nicely with your comprehensive plan with our map upgrade.

Lots of interesting opportunity here, I think, based on what has been said so far.

Two questions, really.

Because if there is flexibility in that, the idea of tying the length of time to whatever the determined length of affordability is, you know, in some cases,

If a homeowner, if this is gonna be a homeowner building, just improving their single family home, basically if they're gonna stay in their home for 20 years, why wouldn't they necessarily get that benefit for the full 20 years?

And I'm not saying that's a should, I'm just saying that's a question mark we should ask ourselves.

And then related to that, if per Ridge's point, if the,

If there is, let's say, an older single family home that gets replaced by four affordable units, and the affordability gets maintained for X period of time, why again, why wouldn't we incentivize that over the long term?

That's one set of questions I think we should bring to the policy committee.

And then the other one is, sorry, it's elusive and I keep, oh, I noticed.

Would you provide an update on the data?

And I didn't see it in the spreadsheet, but we were trying to do the calculations on the fly.

But would you provide like looking back at 2012 through 2021, the data we have, and then plus projecting out, say the next 10 years based on past patterns, the actual amount of cost, the accumulated cost to the city for this program,

because if, for example, we end up revamping the program and it gets used a lot more, we have to be thoughtful about how much impact we're talking about on city revenue.

And then alternatively, if we're gonna revamp the program and limit to certain household income levels, maybe we can spread that wealth over more people effectively too.

OK. That's great.

Let's see.

I don't see any other hands raised.

I see, Phil, you've got your microphone on.

If there are no other comments at this point,

Look for an invitation to come to a policy subcommittee meeting that will be a follow on to this where we can really dive into some of these ideas.

I think, you know, I mean, I think we've got a fairly clear expression of what we would like this to achieve.

I think it'll give us enough grist for a policy subcommittee mill, and then we can bring back recommendations to the HAC to say this is kind of what we came up with.

and make sure that it's meeting the goals that have been articulated today, which I'm not gonna try to regurgitate, but the focus on low-income homeowners, the ability to use this to incentivize even rentals and multifamily that could maintain a period of affordability, those themes have come up, you know, loudly and clearly.

And so, you know, I think we have enough to go on unless people have any more thoughts, I will,

close out the policy subcommittee meeting and pass the baton back to Phil.

Thank you all for your participation.

Yeah.

All right.

Thank you.

Thank you, Ridge.

Appreciate your baton waving.

So yeah, I think we should look at a policy meeting in the next month to two months.

Jason, Jeff, can you give us an idea of the timeline?

I think that was our hope.

if not in parallel, but try to integrate this to the larger plan timeline too.

I mean, there are other, it's pretty clear that this can sort of extend some tendrils out, so we might as well explore that.

So in the next month to two months, we should probably have a policy subcommittee meeting just focused just on this.

So, Phil, how do we take public comments at this point?

I was about to say if anybody's got public comments or thoughts on this matter, if you could use the raise your hand function, Ridge and I can see that and recognize you.

If not, I don't see anything up at the moment.

I don't either.

All right, so we've sort of closed that committee.

We do have sort of the general other business.

Are there other matters that should come before us that we should discuss at this point that are on fire?

And if you're joining us via telephone, press star nine.

I see that we have one caller via phone.

There are no hands raised.

All right.

Oh, Michael Payne.

No, Michael Payne has got his hand up.

When John Sales was housing coordinator, that's something I know he also brought up, but that increasingly is going to become a more and more real reality.

The risk of that affordability period coming due in about a year, they may extend it, but I think certainly in the next couple of years, we could expect that that will lapse and that will open up the opportunity for that to be converted completely into for-profit, non-affordable housing.

I don't know the solution but to the extent that we can as a council and community think about possible opportunities to try to tee up as best we can an opportunity for a non-profit or community groups to be able to provide funding to purchase that and maintain its affordability once the affordability period ends.

Obviously that will be huge because if we don't do that, we'll lose a substantial amount of affordable housing.

Right, right.

Gotcha.

I'd like to add onto that.

Yeah, I'll just echo what I said in the chat a moment ago, which is if anyone has a connection to the owners, I would welcome that.

Just FYI, the owners did reach out to us now, it feels like three and a half years ago.

I think literally that long ago, maybe.

to just, they're distant owners, they're not here in the city proper, but they are a family run, not affordable housing, they're a family run housing organization, some for profit, some non profit, sorry, some market rate, some affordable.

I got the impression from that conversation they were planning on holding over the long term and potentially redeveloping as Lyle talked about.

But I have not heard a peep since then and I don't have that.

They reached out to me.

I never reached out to them.

So I don't have that contact.

Any other comments?

Any other motions this chair should entertain?

I'd like to move to adjourn.

Motion to adjourn.

Thank you.

Any discussion?

All in favor?

Aye.

Aye.

Any opposed?

All right.

Thank you very much.

All of you, welcome new folks.

Thank you, guests.

I guess most of you are at home, but in any case, you can't stay here because we're going to be closing this meeting.

So thank you very much, folks.

Bye.