Chapel Hill's affordable housing supply threatened

Tina Vaughn’s job at Chapel Hill’s Public Housing Department has become increasingly difficult over her decades-long career.

It’s been about 20 years since the town of Chapel Hill received an increase in federal funding for public housing, which comes from the U.S. Department of Housing and Urban Development. And the process to apply for funding has become more complex, said Vaughn, director of the town’s public housing department.

“It’s very competitive to get housing,” she said. “There is some, but it’s not as easy as it was in the past.”

The last increase funded 24 housing units in Chapel Hill, bringing the town’s total number of units to 336 apartments in 13 neighborhoods.

The disconnect between how much money Chapel Hill has for affordable housing and how much it needs has forced the town to look for other options to accommodate its low-income residents. With its supply of federal funds stagnating, the town has implemented provisions for private housing developers to secure additional affordable housing options.

Private developers are required to allocate 15 percent of the units for affordable housing within the town limits and only 10 percent if the development is within the downtown area.

To qualify for public housing, a person’s total income cannot exceed 50 percent of the area’s median income for newer units, and 80 percent for units occupied before October 1981.

The qualifications for a person to receive affordable housing provided by a private agency differ from the town’s. For private companies, the ceiling on a person’s total income can be as low as 30 percent.

The town draws money from the U.S. Department of Housing and Urban Development’s Community Development Block Grant and HOME programs to also provide money for private agencies, including EmPOWERment Inc. and Habitat for Humanity, which use the money to manage affordable housing of their own.

The town’s reliance on private developers to provide a strong supply of affordable housing was questioned this summer after several housing companies stopped accepting Section 8 housing vouchers and more than 60 local families said they were at risk of losing their homes.

In August, Mayor Mark Kleinschmidt and Carrboro Mayor Lydia Lavelle held a joint press conference to address the situation. Kleinschmidt admonished the companies for no longer accepting the vouchers.

“The Supreme Court tells us that corporations are people,” Kleinschmidt said, referencing the Supreme Court’s Citizens United decision. “So those corporations should have hearts.”

In the press conference, Kleinschmidt promised the town would find a long term solution to provide more affordable housing options.

In an interview Wednesday, Kleinschmidt said the town will continue to use affordable housing as leverage when a developer requests a zoning change to accommodate a building project. While it is illegal for the town to control rent rates, Kleinschmidt said the Town Council can do its best to provide incentives for developers who allot parts of projects to affordable housing.

In November 2013, the town announced its plans to partner with the Raleigh-based firm Downtown Housing Improvement Co. to build more housing for low-income residents on Legion Road.

The N.C. Housing Finance Agency threw out the company’s application, which asked for tax credits for the affordable housing projects because DHIC failed to include a commitment letter. The company plans to reapply in January.

Robert Dowling, executive director of Community Home Trust, which focuses on finding affordable houses, said residents have a hard time finding housing, whether it is a house or rental apartment.

“For low-income people, they’re both difficult,” he said.

Dowling said the market has still not fully recovered from the recession — meaning banks are still hesitant to loan money to home buyers.

Dowling said he thinks the town is doing a good job being proactive about the situation.

He said he has also seen college graduates now turning to affordable housing as they struggle under the burdens of student loans.

“The ramifications of (the housing crisis) are still being felt today,” Dowling said. “That has ripple effects on the economy.”

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