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Financing Affordable and Workforce Housing in Location-Efficient Areas
September 26, 2011 Northside BeltLine Trail, completed April 2010
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Atlanta BeltLine Overview
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Trails33 of Network Trails
Affordable & Workforce Housing5,600 Units
Historic Preservation Public Art &Streetscapes
Parks1300 + new acres
Jobs & Economic Development30k jobs
Environmental Clean-up 1100 + acres
WHAT IS THE ATLANTA BELTLINE?Key Elements
Transit 22-mile loop
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BELTLINE FUNDING
• Anticipated Funding Sources • Capital Costs
ActivityAmount(In Millions)
Land $ 570
Parks & Trails $ 340
Transit & Transportation Improvements $1,375
Workforce Housing & Incentives $ 360
Admin & Project Management $ 32
APS Projects $ 95
Total Capital Cost $2,772
Source: TAD Redevelopment Plan, Nov 2005
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TAX ALLOCATION DISTRICT
How does the BeltLine TAD work?
1. When the TAD was adopted in 2005, the City, County, and Public Schools agreed to forego tax revenue generated in the TAD at the time of adoption for the next 25 years.
2. As new development happens because of the BeltLine, additional tax revenue is generated. This additional tax revenue helps pay for the BeltLine.
3. After 25 years, the City, County and Public Schools receive all tax revenue, which is higher than it would have been without the BeltLine.
Tax
Reve
nue
2005 2030
1
32
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Affordable Housing Trust Fund
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LEGISLATIVE FRAMEWORK
• City Council established the BeltLine Affordable Housing Advisory Board (“BAHAB”)
• BeltLine TAD authorizing legislation requires 15% of net bond proceeds capitalize the BeltLine Affordable Housing Trust Fund (“BAHTF”)• 5,600 unit goal established by City Council
• State Tax Allocation District restrictions: capital expenses within the Tax Allocation District (“TAD”)
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BAHAB GUIDING PRINCIPLES
• Facilitate housing near jobs for working families who are otherwise priced out of the in-town housing market
• Serve as a catalyst for the revitalization of communities around the BeltLine
• Help mitigate involuntary economic displacement
• Other key principles:•Transit-oriented Development•Long term affordability and wealth creation•Preserve existing housing, where possible•Mixed income developments
•Mix of owner occupied and rental•Green construction•Barrier-free housing •Equitable geographic distribution•Grants (not loans)
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BAHTF POLICY FRAMEWORK - OUTLINE
• Major BAHTF components: Down payment assistance, Grants to develop & preserve affordable housing, and Funds for property acquisition for future affordable housing.
• Affordability Target: AMI for Rental and Owner Occupied
• Location: Based on housing need/market conditions, Near existing/planned transit, and Equitable distribution of units throughout the Beltline
• Sustainability: Community Land Trust, and Specified periods of minimum affordability for rental and owner occupied units and longer occupancy requirements where subsidies are utilized.
• Mitigate economic displacement: Possible tools include: Inclusionary zoning, CLTs, Preservation of existing subsidized housing, local/state Housing Trust Fund with dedicated funding, Educational Campaign, property tax reform, etc.
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Affordable Housing Trust Fund Financing
• 15% of TAD bond proceeds dedicated to the BeltLine Affordable Housing Trust Fund
• Incentive gap financing (other developer equity and sources of financing needed)
• Early application in the process (fully funded financial plan not necessary)
• More than just financial incentives• Master planning prepares communities for land use and
zoning densities• Parking requirement relief (in process)• Transit, parks, trails
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Budget($)
FundsCommitted ($)
Funds Revolved($)
FundsRemaining($)
AffordableUnitsFunded
Total Units Funded
$ Per Affordable Unit
MultifamilyDeveloper
Incentives
2,530, 000 2,530, 000 - - 120 134 21,083
Down payment
Assistance
1,544,309 1,343,636 - 200,673 42 42 31,991
TOTALS4,074,309 3,873,636 200,673 162 176 53,074
Trust Fund Status (As of 7/25/2011)
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Affordable Housing Trust Fund Financing Key Learning Challenges
• Coordinating with other key resources – especially HOPE VI / Choice Neighborhoods and LIHTC;
• Convincing Banks to provide Mixed Income Housing Financing
• Building housing in more affluent areas of the TAD where little or no affordable housing currently exists
• Facilitating long-term affordability
• Mitigating displacement in areas outside of the TAD • Spending bond proceeds in a down market
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A Solution to Long-Term Affordability:
Community Land Trust(CLT)
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CLT’s and the BeltLine: Atlanta Land Trust Collaborative (ALTC):
A Smart Way to DevelopExtends the impact of public
investment.
Helps limit the impacts of gentrification.
Deepens the opportunity for community engagement.
Promotes neighborhood stability
ALTC Goals: Create favorable climate for CLT
development.
Nurture formation of at least two neighborhood-based, resident-controlled CLTs within the next three years.
Perform stewardship functions of a CLT in neighborhoods where local capacity does not exist to carry out these functions.
A New Vision for CLTs in Atlanta
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Solution to Building Housing in Affluent Areas:
Property Acquisition Strategy
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Property Acquisition Strategyfor Affordable Housing
• Need: • Create affordable housing in the following locations:
• higher land price areas – especially in north and east Atlanta
• near transit implementation
• Must spend time-sensitive dollars before subsequent bond issuance; incentives intended to promote development, not as effective given current market conditions.
• Take advantage of falling land costs
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Property Acquisition Strategy for Affordable Housing
Location principles: A. Required:
Near transit: within ¼ mile of BeltLine ROW or MARTA station
B. Preferred:• Within historically strong markets to
promote equitable distribution of affordable housing: block groups with median household incomes greater than 60% of AMI (in green).
• Acquisitions allowed outside green for (a) properties along a BeltLine segment for imminent transit implementation, or (b) mixed-income developments with a significant market rate component;
• Acquisitions that do not displace residential tenants
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Additional Recommendations
Consider taxable (vs. tax-exempt) bonds;
Establish inclusionary zoning or flexible zoning codes to permit higher densities that support affordable housing;
Focus on land banking and property acquisition
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QUESTIONS?
Contact Info:
http://www.livealongthebeltline.com/ www.beltline.org
Atlanta Beltline Inc.: 404.614.8300