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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.
- Partnership with Wake County:
- City staff is represented on the fund administrator selection team.
- The estimated administrator selection will be August 2021.
- The fund is projected to be fully operational in early 2022.
- Public-Private Partnerships:
- Healing Transitions: The commitment letter for $3 million has been executed by both parties. City funds will be used toward the renovation/expansion of the men's campus. The loan documents will be drafted for closing after July 1. The loan will be 0% interest, no repayment, and forgiven by September 27, 2047.
- Permanent supportive housing: The NOFA has been issued with submittals due June 30. A request is anticipated from CASA for King's Ridge for 100 units. Support is also being requested from Wake County. Raleigh Housing Authority and Wake Housing Authority are anticipated to provide project-based vouchers.
- Small-scale, non-profit projects: Staff recommends the RFP process to solicit non-profit proposals for the following projects: non-congregate (family) emergency shelter, transitional housing, and other affordable rental projects having one-third of units at 30% AMI. City staff recommends looking at other resources and will provide a more detailed report to City Council in June.
- Affordable Housing Bond Executive Subcommittee:
- The Executive Subcommittee is led by Co-Chairs Paul Kane (Home Builders Association of Raleigh) and Yvette Holmes (DHIC).
- The first meeting is pending.
The City Council approved for staff to proceed with Wake County in an RFP process to solicit proposals to expand non-congregate (family) emergency shelter capacity, as well as provide opportunities for transitional housing and small-scale affordable housing projects. City Council also supported including the anticipated HOME funds and the land lease of City-owned lots in the RFP.
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.
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% | $19,800 | $22,600 | $25,450 | $28,250 | $30,500 | $32,800 | $35,050 | $37,300 |
| 50% | $32,905 | $37,650 | $42,350 | $42,350 | $47,050 | $50,850 | $54,600 | $58,350 |
| 60% | $39,540 | $45,180 | $50,820 | $56,460 | $61,020 | $65,520 | $70,020 | $74,580 |
| 80% | $52,750 | $60,250 | $67,800 | $75,300 | $81,350 | $87,350 | $93,400 | $99,400 |