(Cross-posted from Florida Workforce Housing Network.)
ORLANDO, Fla. --- Andrew Nothstine of Glatting Jackson Kercher Anglin, Inc., was the lead presenter at a Professional Development Housing Workshop at the Tampa Bay Regional Planning Council in St. Petersburg two weeks ago.
He delivered his PowerPoint presentation ---"Best Practices in Affordable Housing"---before about 80 professional planners at the Florida chapter, American Planning Association's (FAPA) event.
His overview struck me as superficial. I imagined his audience---planners whose decisions impact affordable housing considerably---would express a substantially higher awareness of and concern for affordable housing.
That's not a criticism of planners, or of Nothstine---planners analyze hundreds of levels of highly detailed information, requiring mastery of dozens of complex professional skills. Affordable housing ranks as one of literally hundreds of their priorities.
Hopefully, information and awareness can help make it a higher priority. Nothstine wants to develop more and better educational materials for Florida professional planners and administrators. He's already started revising his own book---New Directions in Affordable Housing. It's available for download as a .pdf file here, or visit the Glatting Jackson web site.
He agreed to answer 12 QUESTIONS:
1. At the Tampa Bay Regional Planning Council seminar, you showed data that indicate transportation costs play a much bigger role in the housing affordability matrix than most community developers recognize. Could you elaborate on that a little?
Nothstine: Too often, we think of the affordable housing problem as simply a matter of housing costs. In reality, the issue is much more complex. In a high-housing cost environment, most families do not end up in chronic homelessness; rather, they "drive to qualify," buying or renting lower cost housing that is far from employment, commerce, or transit opportunities.
While these families may have "solved" their affordable housing problem, they have essentially traded for a transportation affordability problem. This trade-off has a number of serious impacts on society, from air pollution and traffic congestion to declines in social capital and community-building.
One recent study showed that Atlanta, a city that has relatively low housing costs, was the second least affordable place to live when factoring in transportation costs (behind only San Francisco).
My presentation used the examples of New York and Tampa; when combining housing and transportation costs, Tampa is actually a less affordable place for the average family to live.
The annual cost of owning a single car is between $7,000 and $8,000. The typical household in an auto-dominated environment spends more on their transportation than health care and food combined.
Clearly, even if we "solve" the affordable housing problem, we have done nothing for low- and moderate-income families unless we also address the transportation affordability question. This is a much more difficult problem, in my estimation, requiring drastic changes to land use patterns, infrastructure investments, and political priorities.
2. For typical Florida home buyers, are 'housing cost' and 'transportation cost' inverse ratios? Should planners consider transportation and housing costs as a single unit?
Nothstine: These two costs are not necessarily inverse ratios. In many communities, however, they certainly can be inverse for low- and moderate-income households, particularly in places where alternative modes of transportation are not feasible. For the same reasons I discussed above, I believe planners should consider both costs when designing affordable housing strategies and transportation systems.
3. Glatting Jackson Kercher Anglin, Inc., ranks as one of the largest planning firms in Florida. What sorts of projects have you worked on within the past year that include affordable housing? Any idea what proportion of housing in Florida land planners touch?
Nothstine: I have worked on a couple of Developments of Regional Impact (DRIs) that are exploring a variety of methods for including workforce housing. A number of large-scale community developers are doing innovative things with this issue throughout the nation, given their sheer size and influence (see my response to Question 7). On the second question, I would have to guess 100%. Florida has complex growth management requirements and approval processes; navigating this maze of regulations and politics certainly requires someone with expertise in land planning. Obviously, just because a land planner is involved with nearly all housing projects does not mean that all projects are following good planning principles.
4. What priority does GJKA place on affordable housing development? What services do you provide now, and what can you offer clients?
Nothstine:We offer services to both public and private sector clients on this issue. Given our firm's experience with both local governments and private developers, as well as numerous other entities involved in building communities, we can help develop holistic and innovative affordable housing strategies that are fair, effective, and long-lasting.
Our services could include helping a local community revise their land development codes to eliminate regulatory barriers, or helping developers handle their legal/political obligations to incorporate workforce housing into their projects, among numerous other advisory roles.
We hope to offer assistance on a variety of affordable housing problems, but, perhaps more importantly, we hope to incorporate affordable housing solutions into the other work we do, from urban redevelopment to transit planning.
As I mentioned previously, affordable housing should not be viewed in a "silo," as it is integrally related to numerous other problems facing our communities. Our firm works hard to address these complex issues through an approach that considers all of these factors and influences.
5. Housing affordability seems to be an increasingly important public policy issue in Florida. Planners---public and private---impact housing at the regional planning level with Future Land Use policies and at the more practical level with DRI and subdivision plans. Is it time for Florida to revisit its planning requirements for affordable housing? Do current DRI requirements adequately address the affordable housing problem?
Nothstine: I personally believe that the state needs to revisit the existing planning framework, and not just for affordable housing. Take a look around the state: we have clearly failed on a multitude of levels.
The DRI process is certainly not adequate for addressing this problem. Most projects in Florida do not reach the DRI threshold, so a large proportion of development avoids the process entirely. Even for the relatively small number of projects that are DRIs, there is significant debate over the methodology used for the affordable housing analysis, and the mitigation options are often quite minimal, given the magnitude of the state's problem.
6. Generally, what sort of affordable housing requirements does Florida provide for in its planning policies? If I want to develop my 1,200-acre farm in Pasco County, what affordable housing provisions do I need to consider?
Nothstine: In most jurisdictions, there are no regulatory requirements to provide affordable housing, or even to consider affordable housing issues. Many communities have various incentives available for affordable housing, though many of these are not very effective.
DRIs are the exception; these projects are required to assess the amount of low- and moderate-income jobs their development will generate. This number is then compared to the amount of housing that is affordable to these workers within a certain radius of the project. If the developer can prove there is enough housing for these workers, then they are not required to do anything else.
If there is not enough housing, they must somehow mitigate for the deficit. They might do this through a financial contribution to a housing trust fund, by building affordable housing either on-site or elsewhere in the community, or through another mechanism agreed to by the local government. Until recently, very few DRIs made it to this final step. Most were able to "prove" the existence of adequate housing supplies within the specified radius of their project, and thus were not required to provide any mitigation.
Just because there are very few regulatory requirements, however, does not mean that developers aren't facing intense political pressures to "do something" about this issue. Development can only occur after a negotiation dance among the developer, the public, and the regulatory agencies on a variety of issues. Affordable housing is increasingly a part of these negotiations.
Some developers, undoubtedly, would prefer concrete regulation to the uncertainties of back-room political pressure.
7. GJKA works with many large-scale community developers whose projects have 10-20 year timelines and result in 1,500 to 5,000 new homes. Generally speaking, do large-scale new community developers have any inherent interest in affordable housing components or do local ordinances and Fla. DCA requirements provide most of the motivation?
Nothstine: Most large-scale new community developers do have an inherent interest in this issue. By definition, these developers have to attract a large market, due to the number of homes they need to sell. Having a wider range of price points helps broaden their potential market and increases their absorption rates.
Additionally, having affordable homes mixed with low- or moderate-income employment opportunities helps increase what planners call "internal capture": that is, the number of vehicle trips that remain within the project's boundaries. Higher internal capture results in lower off-site traffic impacts, which in turn allows the developer to pay less money for transportation improvements in the region.
8. Florida's troubled housing market is hardly news, but one trend sticks out: more 'market' builders and new community developers today are building homes priced within reach of at least the top rung of the affordable ladder - home buyers who earn 100-120 percent and even 140 percent of Area Median Income. Do you see this as a long-term trend? Are we seeing some convergence here?
Nothstine In general, I think the market is pretty good at responding to demand. There is obviously a lot of demand for price points that can be met by people earning in the 100-140% AMI range.
Barring external factors (such as regulatory barriers), the market should be able to adapt and offer products that meet this demand. The problem with the housing industry is that there are often a lot of these external factors that skew the marketplace.
One example is that the public sector essentially subsidizes low-density, auto-dominated living and development patterns, through enormous investments in roads and ineffective, unnecessary land development codes.
The market alone, cannot overcome these factors.
9. At the FAPA affordable housing workshop at the Tampa Bay Regional Planning Council two weeks ago it was apparent there are serious information gaps when it comes to affordable housing issues. Your 'overview' presentation was based on materials that were published a year ago. Are professional and public planners behind the knowledge curve on affordable housing?
Nothstine: The presentation is based on a publication that I wrote a year ago, but it has been updated throughout the last year to include newer ideas, research, and data. I do think that a lot of planners are behind the curve on this issue. The planning and development industry (myself included!) has a lot of catching up to do.
My goal is to help educate planners, the media, and residents on how this issue relates to the other problems in our communities, such as traffic congestion and economic competitiveness. We have to be able to show the upper-class family in the wealthy suburb how this issue affects their everyday life. Affordable housing is about sustainability, livability, mobility...it is not just about a house for a poor person.
10. Inclusionary zoning that requires developers and builders to designate a percentage of affordable housing units in new subdivisions is one of the more radical public policy solutions to the affordable housing crisis. Blue chip developer interests---the Florida Home Builders Association and the Association of Florida Community Developers to name two---are adamantly opposed. What do you think?
Nothstine Honestly, I have mixed feelings on inclusionary zoning. On the one hand, there are a number of benefits to such a policy. They generally result in a relatively large number of affordable units, and in places that have a well-designed ordinance, these units remain affordable for a substantial period of time. The policies can also be a benefit to developers, as it is a consistent, black- and-white rule that is (theoretically) applied equally to everyone.
Inclusionary zoning removes a lot of uncertainty, which to most developers is a huge factor; it allows them to plan for the known affordable housing costs at the beginning of the development process, rather than get caught unexpectedly with unknown costs at the end.
Inclusionary zoning also removes NIMBY complications: if every community is required to include affordable housing, it is harder for NIMBY opposition to organize and fight successfully; after all, they can't fight every single project. Many planners also identify social benefits of inclusionary zoning, as the policy usually results in true mixed-income communities, and helps to remove the stigma of affordable housing.
On the other hand, though, affordable housing is a societal problem, with a number of complicated causes. Asking one segment of society (residential developers, essentially) to "solve" the problem places an unfair burden on a single industry.
Additionally, these ordinances tend to be heavily focused on greenfield development. Throughout the history of this country, brand-new homes on greenfield sites have almost never been the affordable products in a community.
Affordability can be better handled through the existing housing stock. We need more policies in place to target rehabilitation and redevelopment initiatives.
Finally, unless inclusionary zoning is enacted on a regional level, it could easily result in leap-frog development, in which developers will simply move to neighboring jurisdictions that do not have such a policy in place.
11. One of the biggest shortcomings of the affordable housing movement is a lack of definitive market analysis. How do planners assess affordable housing need? Beyond sales figures, how do you demonstrate affordable housing need in a community?
You've touched on another hot-button issue here (saved the hard ones for last, I suppose!) There is not a widely-accepted method or standard for assessing affordable housing need. As with any complex issue, the numbers and statistics can be manipulated to suit almost any viewpoint. There are many respected economists who argue that there is no affordable housing problem, for instance.
As I mentioned above, there is currently an effort to revise the methodology used for DRI affordable housing studies.
I'm certainly not an expert in market analysis or affordable housing demand studies. As a very basic description, planners compare the existing housing stock to the household incomes in their community. In a perfect place, the two correspond; in the real world, there are imbalances in certain income categories.
The planner can identify these imbalances (such as a lack of homes for people making between 80 and 110% AMI, for instance) and craft policies that target that particular income group.
A more generalized, back-of-the-envelope method is comparing the median salary to the median housing price in a community; a multiple above a certain threshold might indicate affordability problems.
12. Predict the future. What housing trends do you see that directly affect affordable housing? Will a store manager, or teacher, or health care worker be able to afford to buy a home in Florida in 2020?
I think a lot of the trends we're seeing today bode well for the future of affordable housing. We are seeing a greater market interest in communities with diverse housing types and a mix of uses, two pre-requisites for quality, successful affordable housing.
We are also seeing a number of local governments express a greater appreciation for density and transit, which are also critical components of the solution. It's hard to say what Florida's market will look like in 2020; this state probably has one of the most confusing, dynamic, and volatile markets in the nation. I don't think the incredible growth rates we've seen over the past several decades will be able to sustain themselves much longer; a slower growth rate would, in theory, cool appreciation rates, thus opening a wider range of housing choices to our low and moderate income workers.
Obviously we are starting to see price drops already; this will probably be a painful but necessary start to a more sustainable pattern.