Affordable housing lot program faces hurdles, changes
St. Petersburg administrators are revamping the city’s Affordable Lot Disposition Program to increase attainable homeownership opportunities and eliminate construction delays that can span nearly four years.
Beatriz Zafra, special projects coordinator, explained the initiative’s unexpected challenges and proposed solutions to city council members at a Jan. 11 committee meeting. The program began in 2018 and allows officials to convert lots obtained through foreclosure into affordable, single-family homes.
Developers have built 35 houses on the city-owned lots, and 13 are under construction. The average sales price is about $261,300, and homebuyers typically earn less than 80% of the area median income (AMI).
However, administrators have encountered unexpected challenges. City documents state that the “current process was intended to broaden the base of non-profits working in the creation of affordable housing but has unintentionally resulted in a significant disparity in productivity amongst program participants.”
“The average (construction) completion time for our top three performers is 12 months, which isn’t that far from the top performer …,” Zafra said. “But you can see the average completion time for our bottom three performers jumps up to 41.3.”
A vacant, foreclosed parcel that became part of the Affordable Housing Lot Disposition Program.
In addition, Zafra said terminating underperforming organizations would further delay the process. She said transferring a previously allocated property to a new developer typically takes six to 12 months.
Zafra said that the timetable would significantly increase if construction had already commenced. She also noted that the process requires substantial staffing resources across multiple departments.
“So, to address those challenges, we’ve come today to propose a change to the request for qualifications process,” Zafra added. “We believe this would allow us to streamline the process and the need for pre-qualifying developers up front instead of holding committee meetings each time lots become available.”
She said the proposed tweaks would provide a more detailed review of applicant qualifications. The current process allows for self-attestation.
Program administrators have previously approved 79 developers who receive notifications when lots become available. Those interested have 30 days to submit an application, which is scored by staff and presented in a committee meeting.
The chosen organization must sign a lease and development agreement and pay $10 rent for the first 18 months. That increases to $500 on the 19th month.
Once construction is complete, the city sells the property to qualified buyers. Zafra said a restrictive covenant limits resales to other income-eligible residents for seven years.
City administrators hope several changes will increase program efficiency and provide additional homeownership opportunities, particularly in the South St. Petersburg Community Redevelopment Area (highlighted, right).
She said the new process would increase that mandate to 10 years. Additional proposed changes include allowing accessory-dwelling units (ADUs) and duplexes to increase density and charging an upfront, flat development fee instead of monthly rent payments.
Program officials also seek approval to transfer 33 vacant, foreclosed lots the city bought through its Neighborhood Stabilization Program to the updated lot disposition initiative. “These are some things that we think could make the program better, based on the data we’re seeing,” said Amy Foster, neighborhood affairs administrator.
“But we didn’t want to get too far down that track without you (the committee) having an opportunity to give us input and feedback …”
While Councilmember Richie Floyd would prefer the city to retain ownership, he approved the program changes. Multiple council members expressed appreciation for allowing developers to build ADUs.
Council Chair Deborah Figgs-Sanders requested a list of the 79 previously approved developers. She also asked if there are opportunities for underperformers to seek guidance and continue participating in the program.
“We try to work with folks,” Foster replied. “We want to understand their challenges and, when we can, resolve them. The people who sit on a lot for 30 months and do nothing – I’m more worried about those folks …”
Administrators will incorporate the committee’s feedback, which did not include any significant changes to the proposal, and present an official resolution to the full city council in the coming months.
