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It has been a rough couple of weeks of setbacks for affordable housing both locally and statewide. In St. Pete, a fearful west side neighborhood rejected a poorly-communicated plan to purchase a church property for low-income senior housing. We now owe it to our citizens to dust ourselves off, heal from the controversy and be sure to learn how to do much better next time.
In Tallahassee, yet again the State Legislature has proposed to sweep the affordable housing Sadowski Trust Fund. This year the State Legislature has proposed to take an incredible $125 million out of the fund to pay for non-housing related expenses. At the same time, the State Legislature has also unhelpfully restricted cites’ abilities to require developers to be part of the solution. We basically cannot do anything that modifies our City regulations to put the cost of affordable housing on the real estate development industry without compensating developers for doing so. Gone is the ability for cities to charge developers linkage fees or any other added fees on development for affordable housing. Gone is the ability for cities to charge an extra affordable property tax on developers for affordable housing. Gone is the ability for cities to mandate affordable units in developments without compensation to developers.
Regardless of what citizens think of these policies locally, our leaders in Tallahassee have given cities a clear directive, which is that we are still allowed to incentivize affordable and attainable housing through local government financial incentives, or elimination of zoning barriers.
Given this new reality of preemptions, I urge affordable housing advocates in St. Petersburg to not get discouraged and keep charging forward with your support for available solutions. Here are some non-preempted solutions that could potentially help set St. Petersburg on the right path towards lessening the affordable and attainable housing crisis in the long-term:
- Create an Affordable Housing Trust Fund That Can’t Be Swept – While the details need to be worked out, this proposal by Councilwoman Brandi Gabbard is a great idea, and I commend her for it. The City of St. Petersburg needs to create a trust fund that is insulated from the political flavor of the month, and cannot be swept for anything but affordable housing. But a dedicated trust fund with a pitifully low balance helps no one; we have a safe place to park the money, but we still have no money. So the next obvious step is to find revenue streams that help us get to work building homes.
- Create a Set Aside of New Development Taxes to Fund Affordable Housing Trust Fund – Late last year, I forwarded a proposal to the administration from Rochester, Minnesota, where the City of Rochester sets aside 5% of the growth in property taxes collected from new real estate developments within their new Destination Medical Center District.
The St. Petersburg Chamber of Commerce then followed with a plan to create a 10% set aside of all new taxes created Citywide for affordable housing, regardless of whether the funds come from new developments or existing developments.
I commend the Chamber for being bold and pushing the conversation forward, though I do understand how the City administration is nervous that setting aside the tax increases of existing developments Citywide could have an impact on future City services. However, I still urge the City administration to narrow the focus and follow Rochester by creating a policy of setting aside at least 5% of the increase in property taxes collected from new larger developments in downtown St. Pete for a housing trust fund. Newer high-rise developments in downtown St. Pete sometimes create over $100,000-$500,000+ in new City property tax revenue per year. There should be a minimum expectation from the City that 5% of this windfall is automatically set aside for affordable housing.
I would also ask that Pinellas County do the same 5% set aside for the housing trust fund with its portion of new taxes created from these new high-rise developments. This can be accomplished by an interlocal agreement that ensures the long-term funding of this housing trust fund.
In the long term, this funding set-aside has the potential to create a permanent revenue source for affordable housing that can withstand a recession.
- Make Complete Neighborhoods a Citywide Priority – AAA estimated the annual average cost of owning a car to be almost $9,000 for 2018. This cost of mobility is extremely taxing on lower income families. We simply cannot achieve affordability while continuing to build a city where the expectation is that everyone needs to own a car.
Enter the “complete neighborhood.” A complete neighborhood is a neighborhood where citizens can conveniently and safely walk and bike to almost all their daily needs including the drug store, the grocery store, jobs, commercial services, parks, and a variety of other everyday needs. The goal is a 10-minute walk to everything. Progressive cities like Portland, Denver, and Minneapolis have all made the choice for a long-term planning towards complete neighborhoods citywide.
Mayor David Fisher helped to do a lot of the great sidewalk design planning that we see in downtown today, Mayor Rick Baker helped to make parks walkable to almost the entire city and helped build a lot of new sidewalks throughout the city, and Mayor Kriseman helped with prioritizing a new citywide policy of complete streets. These are all elements that we can use to help to form complete neighborhoods. In addition, we need to make complete neighborhoods a Citywide priority by revamping our City zoning, transportation, and incentive policies for complete neighborhood growth in the future.
- Modify the Land Development Regulations to Encourage More Attainable Housing – Former Councilman Karl Nurse was right around three years ago when he displayed his concern that our zoning rules discourage the development of smaller home ownership options. Nurse correctly predicted St. Petersburg would see a spike in unaffordability if we didn’t do anything, and a majority of City Council urged the City Development Administration to make changes to zoning regulations back then. The concern was that new homes were starting to exceed $400k in the South Side Community Redevelopment Area (CRA).
With little action taken on this issue, we are now starting to see new homes in the South Side CRA eclipse $600k. This is an emergency in St. Pete for almost every income level, and continued hesitancy to make changes will result in making our entire city unaffordable to a majority of St. Petersburg’s citizens.
I am urging the City Development Administration to keep up the work on smart growth policy changes to the City’s zoning rules in order to allow for the development of more attainable, moderate- sized housing. We need to make Transit Oriented Development a priority. Smart growth policy changes include allowing well-designed compact single family homes, duplexes, triplexes, and accessory dwelling units in certain neighborhoods that want additional housing options other than large lot, large sized single family homes. We also need to look at removing zoning barriers such as density requirements and parking requirements in order to develop more mixed-use apartment buildings with moderately sized, attainable apartments in both downtown and around our commercial corridors outside of downtown.
- Rework the Affordable Housing Density Bonus Program – The City of St. Petersburg has had an affordable housing density bonus program for years that gives developers a density increase in exchange for restricting a percentage of units to be affordable. However, this bonus is rarely used by private market rate developers. To me, this indicates the bonus simply does not justify the expense on developers for providing affordability. St. Petersburg needs a much more robust program that incentivizes affordability.
St. Petersburg is not the only city that has had this problem and we should be looking at other city programs for solutions. I have been very impressed with San Diego, a city that reworked its development community to change its Affordable Homes Bonus Program in 2016. This revamp resulted in a 900 percent increase in affordable home applications per month in the following year.
City officials should work directly with Tampa Bay’s private apartment development community to strike a better balance in a reworked affordable housing density bonus program that incentivizes both smaller, more attainable apartment units and affordable housing for low-income citizens.
Again, I urge housing advocates to not get discouraged and to continue to push forward in doing what we still can to help move St. Pete ahead. We still have a lot of policy options that can help make a world of difference, if we act with a sense of urgency and don’t delay moving forward.
We need to continue to work together as one community on this issue so that we can continue to build a city that works for everyone.