Housing investment collaborative advancing quietly

Back in April, when Mayor Steve Adler made his first state of the city address, he noted a troubling statistic: Austin is the most economically segregated big city in the United States. In particular, that statistic applies to housing, with nearly 50,000 families unable to afford even $500 a month in rent.

As part of a solution to that problem, Adler said perhaps the city should start an Austin Bond program, comparable to the old U.S. Savings Bonds. He also proposed creating what he called an urban land conservancy strike fund to buy and preserve affordable properties.

Now there are people working behind the scenes to see if they can make some of those ideas a reality. Betsy Spencer, director of the Neighborhood Housing and Community Development Department, addressed the issue in a memo to Adler and City Council.

Spencer noted that her staff has collaborated with HousingWorks Austin and the Low Income Investment Fund as well as professor Elizabeth Mueller of the University of Texas at Austin.

In particular, the housing department has been working with HousingWorks “to develop the Austin Community Investment Collaborative (ACIC), a partnership of public, private and nonprofit organizations committed to investing in complete communities that link affordable housing to better opportunities, healthier environments, increased mobility and a higher quality of life. One of the tools that the (collaborative) will deploy is an investment fund that is targeting the preservation and creation of affordable housing in Austin,” she wrote.

According to Spencer, the collaborative proposes “a scaled public-private investment fund that is focused on making Austin more affordable” by investing in housing — as well as child care, community facilities and small businesses — in “high opportunity areas” and/or areas served by mass transit.

Spencer foresees focusing on low- and moderate-income households and including both rental and home-ownership opportunities for people with limited affordable options, “including teachers, public servants, social service employees (and) health care employees.”

The department already had the difficult goal of preserving 20,000 affordable housing units over the next 20 years. The department has a proposed draft housing plan to address that issue in response to a resolution passed by Council in October 2014.

HousingWorks and the Urban Land Institute are working together to come up with financial modeling for the investment fund and plan to bring in real estate professionals in early September to structure the proposed investment fund, according to Spencer.

One of those working on the collaborative is Frances Ferguson, board president for HousingWorks. Ferguson said she did not want to say much about the initiative, because the collaborative has not yet met with all the players in one room. She did say that her organization is working as the convener of the collaborative and that there are three teams of volunteers working to consider additional policy tools; how to work across several government agencies and private entities, as well as nonprofits; and how to finance the collaborative. The goal of course is not only to create more affordable housing but also to preserve existing housing, so that the housing that currently exists is “not torn down and turned into high-end condos.”

On Wednesday, the Obama administration announced that it would be enacting new requirements for cities to ensure that they use federal housing funds to reduce racial segregation. That, along with the Supreme Court decision indicating that the Texas Department of Housing and Community Affairs was not doing an adequate job in promoting desegregation, will likely mean that there will be a stronger push from the city to place more housing in neighborhoods outside of East Austin.

On Thursday, Adler said, “I think these kinds of rules are good” and cited the statistic about Austin being the most economically segregated city in the nation. He said the new rules would be beneficial “not only because the law requires it, as we now see, but because the health of our community would be so much greater.”

Joe Mabel [GFDL or CC BY 3.0], via Wikimedia Commons.