By Lisa Sorg
In the closing minutes of a recent heated City Council work session that focused on the lack of affordable housing downtown, Councilman Steve Schewel dropped, almost off-handedly, a bombshell.
Self-Help, a leader in developing affordable housing, wants to build 80 to 100 such units on a prime piece of property downtown. Prime as in next to the Durham Transportation Center, a.k.a. the bus station and the future light-rail stop. Prime as in placing affordable units in the midst of high-end apartment complexes, thus diversifying a neighborhood.
Self-Help would ask the city to donate the land (kudos to Durham CAN for identifying this parcel), and in return people earning less than 60 percent of the area median income (e.g. up to $37,000 for a household of one, $43,000 for two) could live downtown.
Self-Help would apply for the very competitive 9 percent Low Income Housing Tax Credit for 2016, and if awarded by the N.C. Housing Finance Agency, that tax break would be a major carrot—worth about a $9 million—to dangle in front of a builder.
However, Schewel’s aside did not so much as put a period at the end of that marathon work session, but an ellipses.
Since then, the future of Jackson Street property, as it’s now known, not only has become complex and politically fraught, but these complications also underscore the city’s lack of a larger vision for affordable housing. To the city’s credit, Council just approved $100,000 to hire the consultants Enterprise Community Partners to help Durham sort out its priorities and establish a plan. “We have a tendency to want to be tactical rather than strategic,” City Manager Tom Bonfield says. “We need get this right.”
Complicating factor No. 1: First, for his part, Bonfield plans to bring to Council a recommendation in September that the property not be donated to Self-Help, but instead declared surplus and sold. The land would need an updated appraisal, but as of several years ago, Bonfield says, it was valued at $2 million.
The city would then write and issue an RFP that could in fact give priority to bidders interested in buying the land to build at least some affordable units. Or not: Developers have been frothing at the mouth over that property wanting to build office, residential and even a hotel (please, no more hotels).
Schewel says that regardless of whether the Self-Help deal goes through, that Jackson Street parcel should be reserved for affordable housing. “When you think about the area, there are a lot of high-end rentals”—West Village, Whetstone and 605 West—“and putting affordable housing in there is important.”
Complicating factor No. 2: The Durham Housing Authority also is applying for that same tax credit—and a city rarely receives two in the same year—for a project on East Club Boulevard. Meredith Daye, DHA’s director of development, says the organization’s master plan calls for East Club community to be next in line for renovation or demolition and then rebuilt. This would cost the city no money, nor a donation of land.
“Being able to redevelop its communities is important for the Housing Authority,” Schewel says, noting that the DHA is the main provider of affordable housing in Durham. More than 6,000 households live in its communities—and there’s a waiting list of more than 1,000—and another 6,000 receive Section 8 vouchers, which also have an extensive waiting list.
“It’s very delicate,” Daye says of the competition with Self-Help for the tax credit. However, the Housing Finance Agency scores the applications and awards the credits based on that number.
(Lanier Blum of Self-Help told the Coalition for Affordable Housing and Transit Monday afternoon that the Jackson Street site scored a 100.
Other complicating factors No. 3 and 4: Mayor Bill Bell has been lobbying for a city-sponsored rental subsidy, which has been met with lukewarm response by the Council. Not because it’s a bad idea , but because several Council members have public stated that using Penny for Housing Funds to place people in luxury apartments downtown is not maximizing those dollars.
This all brings us back to the Big Question of What To Do, which Enterprise Community Partners will help clarify. For example, Earlier this year, a UNC analysis showed that the city and county owns about 18 acres downtown that could be converted into affordable housing.
“When I consider that property, I believe it needs to be reserved for uses that the free market is unlikely to provide—open space, public parking and low income housing,” says Councilman Don Moffitt. "There are a lot of competing visions for downtown, each with a claim on the city's property. I'd like us to develop a plan for the use of our property over the next 30 years.”