Council Chair Mel Rapozo and I have co-introduced Bill 2725 that would establish a policy of long-term affordability for housing that is provided with taxpayer monies and/or required as a condition of zoning. Bill 2725 would prevent such housing from being sold into the market after a number of years.
Instead, if a qualified family chooses to leave the affordable housing unit, that unit will be available to another qualified family. Buyers of for-sale or leasehold units would be able to recoup their equity but would not be entitled to speculative gains.
Here’s some background on the bill:
The 2,700 affordable homes that the county has developed or required as a condition of zoning over the last 40 years have blessed the families living in these homes and the community as a whole. We all benefit when our families are well housed.
Having built 2,700 units over 40 years, we now have to produce 7,200 homes in 20 years — a herculean task! The recently updated General Plan projects a need for 9,000 housing units over the next 20 years. Based on a recent County Housing Needs Study, 80 percent of those 9,000 units — 7,200 units — need to be affordable for qualified families.
Whenever any affordable unit is re-sold into the market, our efforts to achieve an expanding inventory of affordable housing units are set back because a qualified family is no longer able to afford that home. Returning units to the public trust makes it possible to keep the homes affordable.
Up to now, county policy has allowed affordable housing units, on an ad hoc basis, to be sold into the market. This means that taxpayer monies used to build an affordable house (average cost of $450,000) provides only one generation of affordable housing. The county, then, is always playing “catch up.”
Examples include Kilauea Estates which was built as a result of a zoning condition and with federal post-Iniki monies. The homes went to exactly the people we wanted to help: Kilauea residents born and raised on Kauai, single moms with kids, mechanics, teachers, administrative assistants and others.
These families bought their homes for $159,000 to $180,000 in 1998-99. A 10-year buyback clause required them to sell the units back to the county if they resold the units within 10 years, but after that, the units could be sold at market prices. The homes are now selling for around $600,000.
The unworkability of existing policy is most apparent with the example of Courtyard at Waipouli.
The 82-unit affordable housing rental project across from Kintaro Restaurant was required as a condition of zoning for the Kauai Lagoons resort development (750 luxury oceanfront condos above the Kauai Marriott), but it had only a 10-year buy-back clause.
In 2009, in an act of short-sightedness, the County Council and mayor permanently waived the affordability requirement for 41 of the 82 units. Next year, on Aug. 19, 2019, the buy-back clause expires and with it the affordability of the remaining affordable units.
Forty-one qualified families renting there will have to move. So will the other 41 who are renting at market rates if the units are converted to vacation rentals. In this current housing market, where will all these families go? Instead of expanding, Kauai’s affordable housing inventory will be shrinking.
By requiring that all future affordable housing provided as a condition of zoning and/or using federal, state or county monies be affordable for the longest period allowed under the law, Bill 2725 will prevent 10-, 20-, 30-year buybacks.
Instead, it will encourage existing forms of affordable housing such as multi-family rentals on county-owned land and 99-year leaseholds of single-family homes.
It will also encourage new forms of affordable housing, such as limited equity cooperative housing and community land trusts. In all of the above forms, except for multifamily rentals, the original owner will be able to get back his/her equity if the owner chooses to move.
In conclusion, Bill 2725 establishes a policy that will prevent backsliding and will instead enable the county to create an ever-expanding inventory of affordable housing.
Only then will we begin to address the crisis that is causing both short-term and long-term suffering of local families and a diminished quality of life on Kauai for all.
A public hearing on the bill will be held Wednesday at 1:30 p.m. in the Council Chambers at the Historic County Building.
Source: Joann Yukimura
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