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Affordable Housing Bond Status Report - May 2021
The Housing and Neighborhoods Department provided an update on partnering with Wake County in the acquisition/preservation fund, public-private partnerships, and the Affordable Housing Bond Executive Subcommittee during the City Council Work Session on May 18.
Background and Priorities
City Council directed the housing staff to look at two affordable housing bond options for the November 2020 ballot. A 24-person Affordable Housing Bond Advisory Committee was formed to review the bond options, seek public input, and make a recommendation to City Council on a preferred bond package.
City Council provided guidance on the bond priorities:
- Provide generally equal geographic distribution with project investments
- Provide a range of housing types and income levels in coordination with Wake County
- Include new units and rehabilitated units where financially viable
- Seek innovative development partnerships
- Seek projects and acquisition opportunities near planned transit routes like Bus Rapid Transit (BRT)
Housing staff presented the council with two housing bond options in January 2020. Bond elements included:
- Transit-oriented acquisition to support affordable housing
- Public-private partnerships
- Low-income housing tax credit gap financing
- Homeowner rehabilitation
- Down payment assistance
The bond referendum was included on the November 2020 ballot. With the highest approval in bond history, 72 percent of Raleigh residents voted in favor of the bond.
The bond supplements local and federal funding the City is awarded annually. Each year, the City receives entitlement dollars awarded U.S. Department of Housing and Urban Development (HUD) to support programming for homeowner rehab and repair, resources for first-time homebuyers, down payment assistance, and more.
Bond Spending Plan
Bond funding will be utilized in stages over the next five years, beginning on July 1. Listed below are the activities budgeted for the 2021-2022 fiscal year.
| FY21-22 Activities | Amount Budgeted |
|---|---|
| Direct City Acquisition of Sites Near Transit Corridors | $6 million |
| Wake County Acquisition/Preservation Fund | $2 million |
| CASA King's Ridge Apartments | $7 million |
| Healing Transitions - Men's Campus Expansion | $3 million |
| Small-Scale Nonprofit Projects | $2 million |
| Low-Income Housing Tax Credit Gap Financing | $4.8 million |
| TOTAL | $24.8 million |
All Local Funding Sources for Affordable Housing
The current bond is just one of the ways the City is addressing the need for affordable housing. In addition to the bond, federal, local, and emergency CARES Act funding will be utilized over the next five years. The chart below includes an estimate of the total combined funding the City is dedicating toward affordable housing and services for families with low-to-moderate incomes.
| Source | Amount |
|---|---|
| Federal Funds | $18.6 million |
| General Funds | $33.8 million |
| Affordable Housing Bond | $80 million |
| Community Development Block Grants | $1.8 million |
| CARES Act Funds | $9 million |
| TOTAL | $143 million |
What Income Levels will Qualify for Affordable Housing?
The affordable housing bond is an investment to support and enrich the lives of residents with household incomes that are 30%, 50%, 60%, and 80% of AMI.
AMI stands for Area Median Income. It is calculated and released every year by the U.S. Department of Housing and Urban Development (HUD).
| MAXIMUM INCOME LIMITS | FAMILY OF 1 | FAMILY OF 2 | FAMILY OF 3 | FAMILY OF 4 | FAMILY OF 5 | FAMILY OF 6 | FAMILY OF 7 | FAMILY OF 8 |
|---|---|---|---|---|---|---|---|---|
| 30% | $20,100 | $23,000 | $25,850 | $28,250 | $31,040 | $35,580 | $40,120 | $44,660 |
| 50% | $33,500 | $38,300 | $43,100 | $47,850 | $51,700 | $55,550 | $59,250 | $63,200 |
| 60% | $40,200 | $45,450 | $51,700 | $57,450 | $62,050 | $66,650 | $71,200 | $75,800 |
| 80% | $53,600 | $61,250 | $68,900 | $76,550 | $82,700 | $88,800 | $94,950 | $101,050 |