A rare impressive stride toward affordable housing goals should not pass unheralded.
The Legislature, having let opportunities slip away again and again, this session has finally seized on the chance to make a big investment into a fund that should put multiple affordable rental projects on the front burner, where they belong.
This is anything but the last necessary step, of course, and the state must ensure that a share of a proposed $200 million allotment be funneled to the full range of the tenants in need.
And that means projects for families, senior citizens and the chronically homeless who need a dose of stability and support to stay off the streets and out of emergency rooms. Further, the emphasis needs to be on rentals serving residents who are in the category of the state’s greatest need: those earning at or below 60-80 percent of area median income (AMI).
House and Senate conference committee members hashed out an agreement to add $200 million to the state Rental Housing Revolving Fund. That’s the fund’s biggest-ever single cash investment for the fund. Conferees additionally settled on $10 million to go into the Dwelling Unit Revolving Fund that underwrites infrastructure for affordable housing projects.
Finally, the measure, House Bill Opens in a new tab2748 Opens in a new tab, expands an excise tax exemption for construction of affordable rental housing, to incentivize builders to fill in a critical shortage in this housing niche. The cap on the exemption is raised from $7 million to $30 annually, and the tax break has been extended to 2030.
This should produce a rich incentive for building. However, while the bill qualifies the construction of units priced for families at or below 140 percent of AMI, the public-policy focus should remain on the filling the greatest gap at the lower end of the income scale.
That will take some resolve. In Honolulu County, according to recent calculations by the U.S. Department of Housing and Urban Development, a family of four earning $93,300 would be at the 80 percent AMI level and would qualify for housing reserved for that group. This represents an 11 percent jump over the 2017 AMI, and those qualifying families would be able to pay higher rents.
But cautionary notes aside, passage of this measure is unquestionably good news. Activists such as the Rev. Bob Nakata of Faith Action for Community Equity, who worried that funds again would remained bottled up at the state Capitol, were pleasantly surprised by the progress.
Nakata, a former legislator himself, did express concern about what he sees as a significant remaining hurdle: resistance by the community to these projects.
He recounted the neighborhood pushback encountered recently by a senior rental project planned for a parcel on state-owned land, adjacent to the Hawaii Public Housing Authority offices on School Street.
It may be due to what Nakata described as “not-in-my-backyard” resistance to low-income projects or, as housing advocate Betty Lou Larson said, the residents’ chagrin at a high-density development looming large next to their homes.
While accommodations should be made to community concerns — there was some scaling back of these plans, in response — state and county governments have to stay on course in providing needed housing. There are signs everywhere that Hawaii has reached a desperate stage in its housing gap, which grows wider every year.
Larson is a legislative liaison with the nonprofit Catholic Charities Hawaii and has served on the Hawaii Housing Finance and Development Corp., which allots funding to private partners seeking to develop housing projects. She has worked with Partners in Care, which is concerned with supportive housing for the homeless.
One of its projects is planned as a complex to be built expressly for the chronically homeless who need intensive services. These are people who have been housed in existing apartments through the “Housing First” program, using vouchers to cover rent for the private landlord. Larson said most voucher-holders in the past were able to find placement, but now roughly half have trouble doing so.
The new investments should produce a sizable housing yield. It would fund development of up to 25,000 units by 2030. The $200 million from the revolving fund is expected to enable construction of some 1,600 affordable rentals for families.
This funding is meant as seed money to help the developers’ quest for other, private financial sources. There must be continued efforts to reduce the bureaucratic delays in assembling the entire financing “stack” for these projects.
And truly, the neighbors need to be on board — especially considering the expansion of the class that qualifies for housing help. There’s no denying that the inventory of rentals affordable to lower- income earners must to be expanded, and Hawaii’s communities need to work cooperatively toward that end, as well.
