Meeting Notes: Community Conversation May 7th 2016

Housing in Lawrenceville

Meeting Notes

May 7, 2016

See video of the presentation

The following notes are from the latest community conversation regarding affordable housing in Lawrenceville. Video of the entire presentation is forthcoming (available by May 13th). For questions and media inquires, please contact Real Estate & Planning Manager, Ed Nusser at ed@lawrencevillecorp.com or 412-621-1616 x106.

Thank you to Valerie Fleisher for her note taking.

Introductions

Matt Galluzzo, Executive Director, Lawrenceville Corporation

Matt welcomed everyone, and thanked the staff and volunteers from the Lawrenceville Corporation (LC) and Lawrenceville United (LU), as well as the organizations participating in the homeowner and renter resource fair.

Ed Nusser, Real Estate & Planning Manager, Lawrenceville Corporation
Ed’s presentation on affordable housing, the state of housing in Lawrenceville, and the Lawrenceville Community Land Trust (CLT) can be found on the CLT website. [ Presentation link forthcoming ]

Ray Gastil, AICP, Director of City Planning, City of Pittsburgh

Mr. Gastil presented on the preliminary recommendations of the City’s Affordable Housing Task Force (AHTF), focused on the need to use existing tools better, create new tools, and preserve the City’s existing stock of affordable housing. He discussed existing tools for creating affordable housing, such as the 4% and 9% Low Income Housing Tax Credit (LIHTC). While 9% LIHTC projects are highly competitive and typically only  2-4 are funded annually in the City of Pittsburgh, the 4% LIHTC is essentially non-competitive and has potential to be used more often. He talked about the recommendation for some new tools, such as a $10 million affordable housing trust fund used to subsidize affordable housing projects throughout the City.
He also stressed the need to preserve existing affordable housing. Currently there are about 15,000 units of deed restricted housing in Pittsburgh, out of 135,000 households. 1,729 of these units are slated to come out of deed restriction by 2020, and the Task Force is recommending that they remain affordable. In addition, there is work being done to keep naturally occurring affordable housing and rentals from becoming market-rate housing through tax abatements, rehabilitation grants and loans, and incentives for affordable housing development that are easier to utilize. The full list of preliminary Task Force recommendations can be found on the City of Pittsburgh website.

Deb Gross, Councilperson, District 7

Councilwoman Gross expressed her support of the Lawrenceville CLT and the work of the AHTF, and stressed the need to help local families keep their local housing stock, and bring it up to code while maintaining affordability, in order to build local equity.

Q & A Session

Q: What are some of the drawbacks and limitations of a CLT?
EN: The biggest limitation is finding the private and public subsidy to close the gap between construction costs and an affordable sales price. This can be accomplished through the City’s eventual land bank and housing trust fund as well as state programs, and through private philanthropic investment. For a family of 4 at 80% of Area Median Income, spending about 25% of that income on housing costs, an affordable mortgage would be between $140,000-150,000.

 

Q: How does a CLT impact mortgage collateral?

EN: CLT’s are funded through a leasehold mortgage. LC is working with Michael Brown, a national consultant who assists with CLT start-ups, and will be helping to do outreach to lenders in the Pittsburgh region about how these loans are structured.

 

Q: Did the AHTF consider mandatory inclusionary zoning vs. incentivizing affordable housing development?

DG: In other cities, inclusionary zoning is “baked in” to the law and zoning codes. While the housing market in Lawrenceville could survive mandatory inclusionary zoning, there are Councilpersons in other districts facing different concerns. Overall, Pittsburgh is still half depopulated.

RG: The strong real estate market in Pittsburgh is in a handful of neighborhoods, and a couple of types of housing. Virtually every project in Pittsburgh has public subsidy. Today there is 0% incentive for affordable housing, and the City is moving towards some very important ones. Perhaps some neighborhoods and types of housing could be made mandatory, and perhaps Lawrenceville could serve as a pilot.

 

Q: How many CLT homes are there in Lawrenceville and how were they acquired?

MG: The houses were acquired through a combination of arms-length transactions, working through the City’s land reserve process for nonprofits to put abandoned and tax delinquent properties back into productive use, and purchasing units directly from the City.

EN: There are 7 units planned for Phase One of the Lawrenceville CLT. An additional 12 units are going through the land reserve process, and will be cleared in 6-36 months, depending on when they began the process.

 

Q: Is LC considering historic preservation as part of the CLT?

EN: One of LC’s core values is a commitment to preserve the neighborhood’s authenticity. For the CLT homes we are also considering issues of affordability and of efficiency. We are working with Rothschild Doyno Collaboratve and EcoCraft to design homes that are as efficient as possible, not only because of our commitment to the environment but to keep energy costs down for CLT homeowners.

 

Q: How is the need for affordable housing determined, and by whom?

RG: There have been several studies done on affordable housing in Pittsburgh by groups such as the Housing Alliance. The Affordable Housing Task Force held a series of 5 community forums throughout the City as part of its deliberative process. There is also census data that identifies families at or below 50% of AMI that spend more than 30% of their income on housing.

MG: The Lawrenceville CLT is working to make sure that residents and potential homeowners are part of the community process

 

Q: It is wonderful to see affordable housing tools that include households between 50-80% of AMI.

MG: The CLT is not a panacea, but it is a tool to address a specific issue and group within the housing crunch.

 

Q: How do we address other issues in the neighborhood, such as tax incentives for market rate developments?

EN: There are certain tax incentive programs, such as LERTA, that are set to expire next summer, and were set up when property values in Pittsburgh were not appreciating. People are now realizing that land in Pittsburgh does have value, but it is challenging to change policy and legislation as quickly as market conditions have changed in a neighborhood such as Lawrenceville.

DG: Pittsburgh is not one size fits all. However, zoning laws generally apply to the entire City. There is a tool, a zoning overlay such as an Interim Planning Overlay District, that allows zoning tailored to a specific community. It is something to consider, though it is a costly and lengthy community process in order to build consensus.

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