PlanPhilly

Philadelphia policy makers must boost affordable home investments and strategies

In this week’s Agenda 2015 op-ed, HACE's Maria Gonzalez argues that by answering the need for decent affordable housing the city's residents will build more stable lives, and our neigborhoods will be stronger for it. The demand for affordable housing is growing precisely as resources to preserve and create that housing have diminished. Gonzalez calls for Philly to create a comprehensive housing plan and boost resources to the Housing Trust Fund, both elements of the Equitable Development Platform, released by PACDC.

It all starts at home.  When low-income individuals and families have safe, stable and affordable homes in quality neighborhoods, their lives are significantly improved.  Poor children have a better shot of breaking the cycle of generational poverty if they have a home in a mixed-income neighborhood, and mental and physical health outcomes are improved when families have a healthy, affordable home.  Conversely, whether it’s finding employment or advancing educational opportunities, the lack of a stable, affordable home frustrates efforts.   

While some of our neighborhoods are seeing a boom in the development of new market rate homes, this must not obscure the massive unmet need for affordable homes in our communities.  It’s time for the Mayor and City Council come up with a long-range plan to address Philadelphia’s affordable home needs, including making a more significant investment in development of new affordable homes, preservation of existing homes, and homelessness prevention.

According to a recent study by the Federal Reserve Bank of Philadelphia, Philadelphia has a deficit of nearly 70,000 affordable rental homes available to people earning 30% or less than the Median Family Income – the poorest of our neighbors who earn less than $23,400 each year for a family of four.  These households pay an average of $528 per month more than they can afford on housing costs, leaving little for transportation, food, medical care, or other basic necessities, straining our already inadequate social safety net, and putting families under stress that leads to poor health.

Unfortunately, the Federal Reserve study also shows that the number of affordable and available rental units in Philadelphia for our poorest residents has dropped by 9 percentage points between 2007 and 2012.          

I’ve heard it said that Philadelphia does not have an affordable housing problem, rather we have an income problem.  But you cannot separate income from housing in decisions about creating a stronger, healthier Philadelphia.  Building and preserving affordable homes not only creates jobs in our communities, but also provides the stability necessary for residents to take advantage of wrap-around services and programs that boost their earning potential.

That’s exactly why non-profit developers, including community development corporations (CDCs) like HACE, were created.  Founded in 1982 with a mission to combat community deterioration through economic development, affordable housing, and support services, HACE meets a range of residents’ needs in order to re-build the neighborhood's economy.  We have seen firsthand how affordable housing improves the lives of residents, which can lead to neighborhood revitalization.

HACE is the only provider of subsidized, supportive housing designed for the elderly in the St. Hugh and Fairhill Neighborhoods, which allows low-income elders to age-in-place with the services to maintain their independence, engage in community life, and avoid institutionalization.  In partnership with a range of social service organizations, HACE provides direct services to approximately 360 elders in the neighborhood, from housing to health care, energy assistance to financial literacy.

Despite our successes, our residents are affected by the global economic crises and increasing income inequality.  For example, the senior population in HACE’s market area has grown increasingly poor over the last decade. According to recent data from the 2005-2009 American Community Survey, 44% of seniors in our neighborhood are living in poverty, up from 25% in 1980. Presently we have 394 persons on the waiting list for 210 units of senior housing. An application for housing takes approximately 3 years to move up the list for one of these units.  Similarly, the waiting lists for affordable units or housing vouchers from the Philadelphia Housing Authority (PHA) exceeds 100,000 households, and has grown so large and unmanageable, PHA is no longer adding names to the list.  

Dramatic cuts in funding for the US Department of Housing and Urban Development’s Section 202 Program – which provides subsidies for senior housing – means there are typically only two sources of funding for the development of new senior housing:  Low Income Housing Tax Credits and the Philadelphia Housing Trust Fund, both of which are in high demand.  Similarly, Community Development Block Grant (CDBG) funds have been cut dramatically, leaving very little for housing development or preservation for other populations.  In fact, the City eliminated funding of affordable homeownership development due to the cuts.  As with most CDCs, we have a pipeline of projects for rental and homeownership housing that are on hold due to lack of funding. The waiting lists for repair programs to keep low-income residents in homes that are already affordable to them – but need significant repairs to remain habitable – are many years long as well.  

The gap between the needs of Philadelphians and available resources for decent, affordable homes is enormous.  That’s why Philadelphia needs a comprehensive housing strategy that looks deeply at the problem, considers all of the available solutions, and charts a long-range, multi-year path towards significantly addressing the unmet need.  This plan should look at ways to better coordinate the myriad public and quasi-public local, state and federal agencies that play a role in funding and giving approvals to build affordable homes, and which frustrate developers who must navigate this complex web.  It should also look at ways to build more mixed-income communities that contain both market rate and subsidized affordable homes.  We need to at least double resources to the Philadelphia Housing Trust Fund to a minimum of $25 million per year to begin replacing funds cut by the state and federal governments.  Hearings in City Council scheduled for June 1st provide an opportunity to begin considering potential sources of revenue to boost Housing Trust Fund investments.  

Between public officials, social service agencies, developers and community groups, Philadelphia has a wealth of experience, knowledge and capacity to aggressively tackle Philadelphia’s affordable home needs in ways that don’t just put roofs over heads, but change lives and neighborhoods.

About the author

Maria Gonzales, President, HACE

Maria Gonzalez is President of HACE, where she heads HACE’s development team managing more than $30 million in commercial and housing development to stabilize and revitalize the Fairhill and St. Hugh neighborhoods, as well as other services such as housing counseling and to support the frail elderly.  Prior to coming to HACE in 1996, she was an underwriter for the PHIL Loan program for First Union National Bank, Senior Financial Specialist for the Philadelphia Rehabilitation Plan, an employment counselor for Aspira, and Assistant Manager for the Norris Square Economic Development Corporation.  She serves as Chair of the Community Trust Board of the American Street Empowerment Zone, Co-Chair of the Oversight Board of the Mayor’s Office of Community Empowerment and Opportunity, and is a member of the Philadelphia Housing Trust Fund Oversight Board. She also serves on the board of Philadelphia Association of Community Development Corporations. 



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