By Scott Nishimura snishimura@bizpress.net
Fort Worth may make changes in its incentive policy that allow developers who accept public money to choose between setting aside a certain number of affordable housing units, or paying cash into a local housing trust.
Money from the trust could be used for anything from building new affordable housing to rehab, depending on a policy to be formulated by the Fort Worth Housing Finance Corp., and it would target the neighborhoods were affordable housing for the lowest-income families is most needed, Jay Chapa, director of the city’s Housing and Economic Development department, told City Council members during a committee meeting Tuesday.
The Housing and Economic Department Committee, comprising the entire City Council, gave Chapa the go-ahead to put an item on the April 8 City Council agenda that would seek council consensus in executive session on each case before the staff negotiates a final incentive agreement.
Council member Kelly Allen Gray renewed her concerns that most developers will choose the cash option, rather than set aside affordable housing units.
That would put Fort Worth, which Chapa estimated has a 17,000-unit shortage of affordable housing units available to the lowest income earners, in worse position, Gray said.
The council’s incentive policy has been focused on 80 percent of area median income, not the lowest income. And there’s a surplus of available affordable housing at that higher level, Chapa said.
The council this year approved agreements for two developments in the path of the Chisholm Trail Parkway along Bryant Irvin Road, where both developers, given the option, chose not to put affordable housing units in.
The cash option on those two agreements will generate $2.5 million over several years that will go into the housing trust.
But, Gray said, “how many of these projects do we have to do over the course of time to have enough money to put into the housing trust fund to actually start to do projects?”
“The subsidy will come in over time,” Chapa said. “i don’t see another see another source of funding…it was a way to develop a funding source.”
The proposed changes would be to the city’s neighborhood empowerment zone and tax abatement policies.
Based on council direction in each case, the policy would allow developers pursuing city incentives on developments including housing to choose between setting aside 20 percent of their units at affordable housing rates, or setting aside a portion of the incentive to be forwarded to the housing trust.
The set-aside would be $200 per residential unit per year for the term of the agreement, and it would be paid by the developer prior to receiving the annual abatement.
Councilman Joel Burns asked Chapa whether it was possible to “ensure affordable housing was coming into areas we want it to, or geographically close to it so that the mix is there?”
For each case, Chapa said the staff would examine the immediate area to determine the availability of affordable housing.
“We might recommend the $200 (option) if there’s enough there,” Chapa said.
If not, the staff would recommend to the council that it require a set-aside of affordable housing untis, he said.