The Dollar$ and Sense

of Affordable Housing

in Arlington

2015

This module will help you...

Appreciate the public-private partnership that creates/preserves affordable units in Arlington

Understand the major cost componentsLearn how the community benefitsAnswer questions and counter

misunderstandings

Updated June 3, 2015

Myths you may hear

• The County pays a lot of money for affordable housing.

• It’s charity: the people who live in it don’t work or contribute.

• The market can be trusted to solve the problem.

• Affordable housing providers don’t pay taxes.

Q1Why does Arlington County

pay [fill in a large number here]for an affordable* unit?

*a committed affordable unit, or CAF

AIt doesn’t!

CAFs are privatelydeveloped and owned.

A County LOAN contribution leverages other $$.

A note about partnership

• Other area jurisdictions have at least some public housing.

• Arlington’s public-private partnership model has become today’s “best practice.”

County dollars are loan dollars. . . from AHIF, the County’s revolving

Affordable Housing Investment Fund

Less than a of each AHIF dollar is from the County general revenue fund

Source Affordable Housing Implementation Framework Draft 2.0, 2/19/15

AHIF loan dollars

• County has allocated $161M+ since FY08

• to create/preserve/renovate 2,517 units• averaging $64k in County funds per unit

for past 8 years• collecting $69M in timely loan repayments

and payoffs and• $31M in developer contributions

Leveraging public loan dollarsDevelopers generally leverage $34 for every County loan $1Typical funding sources for Typical funding sources for

tax credit projects in Arlington acquisition projects in Arlington

Source Affordable Housing Implementation Framework Draft 2.0, 2/19/15

Leveraging public dollarsLand banking/contribution by developers

The Serrano, purchased by AHC in 2014 for $62M, preserves 280 affordable/workforce/market-rate units

Property can be subdivided to add mixed-use, mixed-income, or affordable units

Leveraging public dollarsLand banking/contribution by developers

The Springs, a 27-unit property purchased by APAH in 1997

Provides land on the urban fringe near Ballston for a new, 104-unitmixed-use development

Q2Why do committed

affordable unitscost so much?

ALand!!

. . . and they are built to County and State codes and requirements.

CAF costs are comparable tonew market-rate units.

Major cost drivers

• Land values• Building standards/required materials• Undergrounding of parking/utilities• Green/sustainable building practices• Retail space set-asides

Land prices add to costs

2009 APAH preserved Buchanan Gardens, paying $12M for 111 units

~$108k per unit

Land prices add to costs

2011 AHC preserved Arbor Heightsfrom market-rate uptick, paying $35M for 198 apartments in 8 buildings on 8.5 acres

~$177k per unit

Quality materials, like brick and glass• help developers compete when

seeking tax credits• comply with standards desired by

the community (as expressed in the Neighborhoods Form-Based Code)

• help make buildings distinctive more attractive streetscapes

Quality materials add costs

but make attractive neighbors

Parking adds to costs

Undergrounding parking costs• Average $35k per space• Can cost much more depending on

site conditions

“Greening” adds costs

Virginia gives EarthCraft* points towards tax-credit awards

*Energy, water, and resourceefficiency standards geared for the SE

Arlington’s Neighborhoods Form-Based Code requires EarthCraft or LEED**

**Re-uses materials or uses recycled,green, and low- or no-emission products;

practices ecological balance in energy use.

Retail set-asides . . .

Required by County for street-front properties, retail space requires• additional parking spaces • higher ceilings and retail “fixtures” • staff to handle retail leasing and

management

Q3Sure, those living in committed-

affordable units benefit.

But what about the rest of us?

ACAFs provide benefits to the

wider community.

Community benefits

Job creation, short- and long-term

ResidenceConstruction

jobsLong-term

jobs

Arlington Mill 341 26

The Jordan 258 19

Residential New Construction Economic Impact Calculator http://housingvirginia.org/Res-New-Cons-Econ-Imp-Calc.aspx

Community benefits

Housing for employees in key sectors

A large majorityof CAF householdsare workinghouseholds

Source Housing Division, Arlington County CPHD, Feb 2015

Community benefits

Lower environmental impact/ greater efficiency

• EarthCraft/LEED building standards • SmartCards are provided for many CAF

residents • Access to public transit keeps more cars

off the road

Community benefits

Sidewalks and streetscapes

Attract businesses,foot traffic, buzz . . .

and more businesses

Invite walking,contemplation,sense of place

Ellen’s Trace

Accessibility/inclusion

CAFS provide housing for persons with special needs

Permanent supportive housing (PSH) and barrier-free units

. . . help integrate persons with disabilities and the elderly into the

community

Accessibility/inclusion

Permanent Supportive Housing (PSH)• 197 CAFs leased by persons with

disabilities and youth aging out of foster care

• PSH program provides case management, rental assistance, and other support services

• 81% of PSH tenants served since 2004 program launch have remained in permanent housing

Education benefits

• Montessori school @ The Jordan serves 24 kids ages 35 (1/3 residents of affordable housing, 2/3 local community)

• vPoint at Clarendon construction preserved/renovated

education buildinghousing early childhood

programs for 170+ children

Education benefits

• Greenbrier Learning Center provides afterschool enrichment at APAH properties.

• AHC community centers offer afterschool, tutoring, teen, ESL, and stay-in-school programs.

Education benefits

• Since 2008, all 61 teens in AHC’s program have graduated high school and 80%+ have gone to college.

Education benefits

• In 2014, 92% of elementary students in AHC after-school programs improved reading level by one grade and/or read at/above grade level.

• Summer camps prevent “learning loss.” • Student stability helps neighborhood

schools.

Preservation/renovation

Retaining neighborhood feel/ renewing local landmarks

Some examples . . .

Preservation/renovation

vPoint at Clarendon

vPoin

Preservation/renovation

Colonial Village, Wesley Housing

Preservation/renovation

Buchanan Gardens, APAH

Housing that“fits” families

Preservation/renovation

The Gates, AHC

Preservation/renovation

The Larkspur, CPDC

Stability benefits

Affordable, family-size apartments allow stable communities without overcrowding.

• Average annual turnover in Arlington CAFs 20%

• Nationwide turnover rates hover around 50%*

Relatively low turnover for CAF tenants suggest they contribute to community stability.**

*Multifamily Executive, Feb 2013

**Arlington County Housing Division, August 2014

Economic benefits

Dollars flow back into ArlingtonNonprofits not exempt from taxes and fees

• AHC properties paid $2.6M in real estate taxes in 2014.

• APAH properties paid $1.9M in real estate taxes in 2014.

Dollars flow back into Arlington• APAH has paid $797K for permits, tap,

and inspection fees (PTI) for The Springs, a 98-unit property under construction in Ballston

• AHC paid $723k in PTI for The Shell, a recently-opened 83-unit building on Columbia Pike

Economic benefits

To summarize . . .

Arlington does not develop and own affordable housing.

It lends to private developerswho leverage additional non-County

funds (3 or 4 to 1) to build and who repay their loans on time.

To summarize . . .

Affordable housing costs no more to build than market-rate units for land, design, materials, and labor . . .

. . . and its developerspay their share of taxes and fees.

To summarize . . .

Affordable housing benefits the community, not just its tenants, through Attractive new buildings or

renewed/renovated properties

Job creation and convenient, stabilizing housing for workers in vital economic sectors

Long-term tenancy as well as resident services programs, helping stabilize neighborhoods and schools

Targeted efforts to support student success . . . and skills for further education and employment

Reliable and supportive housing for persons with disabilities

Taxes and fees to County coffers

Please visit our website

AllianceforHousingSolutions.org

for more on these and other topics in housing affordability.