Unfilled need

Two reports highlight Louisville’s ongoing struggle with affordable housing, vacant properties

Nov 28, 2012 at 6:00 am

Stacked against the likes of San Francisco or New York City, Louisville prevails in housing affordability. And yet year after year, data shows a significant portion of the city’s population earn wages too low to afford a two-bedroom unit, meaning no more than 30 percent of their income goes toward housing and utilities.

Two new reports highlight this issue.

In its annual State of Metropolitan Housing Report due out this week, the Metropolitan Housing Coalition (MHC) maps some disturbing (albeit increasingly familiar) trends:

1) More than 21,000 households linger on the Louisville Metro Housing Authority’s wait list for either public housing or a Section 8 housing voucher.

2) Last school year, JCPS counted 12,389 homeless students, meaning those not living in a stable, permanent home.

3) In 2011, about 17 percent of the city’s population had incomes below the poverty level, and 27.5 percent of children were living in poverty.

4) Fair market rent for a two-bedroom unit within Louisville MSA (which includes Jefferson County as well as surrounding counties) is $698. The income needed to afford that two-bedroom unit is close to $28,000. The median household income for renters in Louisville MSA is $25,633.

5) Seven council districts, most in west Louisville, are home to three-fourths of all subsidized housing.

Among many recommendations intended to combat these issues, MHC urges changes to the Land Development Code that would permit multifamily housing in areas throughout Louisville, not just in western and southern sections of the city.

MHC also recommends finding a dedicated revenue stream that would yield $10 million annually for the Louisville Affordable Housing Trust Fund. It’s estimated that the money could fund construction or rehabilitation of 300 housing units.

In 2008, Metro Council passed an ordinance creating the fund, promising $1 million as seed money. But for years that money never materialized, and frustration among the trust fund’s board grew.

Just before Thanksgiving, however, the Affordable Housing Trust announced money had been secured — $450,000, including $100,000 from the city. Still, much of the focus of the press conference was on their new report, “An Assessment of Affordable Housing Needs in Louisville,” and the need for a dedicated revenue stream.

Standing at a podium, Councilwoman Tina Ward-Pugh, D-9, who sits on the Louisville Affordable Housing Trust Fund Board, addressed media and housing advocates with an urgent plea: “We don’t have time to waste. Affordable housing is a desperate need. I think we have the opportunity for some great momentum here.”

The trust fund report indicates that half of all Louisville households that rent live in housing that’s too costly. And nearly 92,000 Louisville households (both homeowners and renters) struggle to afford housing.

In a statement, Affordable Housing Trust Fund Board President Kevin Dunlap wrote that the “key component” to the fund — an ongoing revenue source — still lacks. He and other housing advocates want Mayor Greg Fischer to approve a 1 percent increase to the insurance premium tax, providing $9.7 million to the fund annually.

It’s not an idea Fischer wholeheartedly embraces. Instead, the mayor took his turn at the podium to advocate for the state adoption of a local option sales tax. This would require a change to the state constitution. Also, there’s no guarantee that, if created, revenue from this local option sales tax would go toward affordable housing.

Those are among many reasons the grassroots group CLOUT (Citizens of Louisville Organized and United Together) admonished Fischer after the press conference. “For whatever reason, Mayor Fischer is not willing to lend a hand to working people, families, school children, seniors and veterans in our community who are suffering due to no fault of their own,” stated Chris Kolb, co-president of CLOUT.

The back-to-back release of both the Louisville Affordable Housing Trust Fund and Metropolitan Housing Coalition reports presses the conversation around affordable housing forward, says Curtis Stauffer, MHC’s development director. Still, he admits even with copious amounts of data outlining need, great hurdles exist.

“We are sadly in an era where a lot of housing efforts are dependent on federal funding,” he says. “We have seen a fairly continual decline in federal programs.”

The U.S. Department of Housing and Urban Development administers programs like the Community Development Block Grant, or CDBG funds, aimed at improving housing and neighborhoods.

According to the MHC report, Louisville Metro’s allocation of CDBG funds in 2012 was 8 percent less than in 2011, for a total budget of close to $15 million. Forty-two percent of that money was slated for the Sheppard Square HOPE VI project, an initiative that will replace old barracks-style housing projects with mixed-income units.

“It just seems like a misplaced allocation of resources given the great need people have for a roof over their heads,” Stauffer tells LEO.

But Tim Barry, executive director of the Louisville Metro Housing Authority, says CDBG funds have always been “part and parcel to the HOPE VI application.”

He also points out that the housing authority plans to replace all demolished low-income units in five years and hopes to replace units lost in the demolition of Iroquois homes, but so far no definitive funding or timeline has been attached to that goal.

MHC reports that in the last eight years, Louisville has lost about 1,000 public housing units. Tied to this issue of affordable housing, of course, is the problem of vacant and abandoned structures. In its State of Metropolitan Housing report, MHC contends Louisville needs a stronger land bank program that will quickly return empty, dilapidated properties to productive use.

“We need to have the city be a little more aggressive about acquisition and management of vacant properties that are causing problems,” says Stauffer, adding that the city has taken positive steps.

With the help of a $4.8 million grant, Metro will try to reduce the number of abandoned properties by 40 percent in the next three years. Metro government also recently secured $3.25 million from a national settlement with mortgage services to fund vacant housing-related programs.