County's Community Housing Trust being reborn
By Stan Zimmerman
Five years ago as home prices soared to a level beyond the means of blue-collar checkbooks, government and business leaders worried about workforce housing. A community housing trust was established to figure out a solution.
But just as the trust finished the blueprints and contracts to start building affordable housing, the real estate market collapsed, and unemployment soared from 2 to 10 percent.
With thousands and thousands of homes on the market, and prices in a continual nose dive, it would seem the problem was solved – except it wasn’t.
"Prices are down, but wages are down too," said Sandy McKitterick. She’s officially the home ownership manager of the Community Housing Trust. But she’s actually everything, because the CHT is down to one employee.
"We have one-income families that used to have two incomes. People are working fewer hours, sometimes a lot fewer hours. Single mothers, reduced benefits," she said.
The relationship between prices and wages? "Frankly it’s not that much different than before," she said.
FEDS TO THE RESCUE
The CHT’s target remains the same – families making 80 percent of the adjusted mean income for the area. In Sarasota County for a family of four, that’s $49,800 per year. A family of three earning $44,800 would qualify. A family of two – a single mother with a child, for example – would have to earn $39,900 or less.
"I don’t feel we’ll have a shortage of people looking for affordable housing," said McKitterick.
The trust has been funded by Sarasota County, but last year the county commission demanded a new way of doing business. The trust’s budget allocation of $250,000 was cut in half, until it could come up with a new business model. On July 8, the wraps were taken off.
The county’s Office of Housing and Community Development has received $7.1 million for the Neighborhood Stabilization Program. "It’s part of the federal stimulus program," said CHT’s Chairman Steve Queior, who also heads the Greater Sarasota Chamber of Commerce. "The CHT has some critical roles in that," he said.
The $7.1 million will be split among the various groups working on affordable housing, including Habitat for Humanity, and GoodHomes. In addition, he said a consortium of five local banks has come forward to create a $1-million pool for the Family Loan Fund.
The CHT will use the money to buy up foreclosed homes, rehabilitate them and use inexpensive solutions to make them more energy- and water-efficient. In the meantime, the CHT is seeking to qualify buyers for the homes.
When a house is ready, it can be sold to the qualified buyers, and the money can be plowed back into the purchase and rehab of more affordable housing. McKitterick is making a showcase of the program to large employers in the county – PGT Windows, Sarasota Memorial Hospital, the school board, Sun Hydraulics and others – in the search for families who might qualify.
At the same time she is looking at foreclosed housing available for purchase. And the trust is looking for what CHT Secretary Ron Shapo calls "a dynamite CEO" or chief executive officer. Board members are volunteers.
The county commission was impressed enough to restore the remaining half of the $250,000. But fiscal 2009 will be the last year of county financial support. As of Sept. 30, the trust is on its own.
THE EVOLVING MODEL
The CHT in the past focused on projects such as Hatten Street, where the county owned a block of shallow lots across the street from Alta Vista Elementary School. With home prices in the stratosphere, the CHT at that time believed it was cheaper to build something new. The trust designed a row of townhouses to fit the site, and it was preparing to break ground when the bottom fell out of the housing market.
The project – once deemed a paragon of affordability – suddenly looked pricey. "A conspiracy of events have prevented you from accomplishing much," County Commissioner Nora Patterson told Queior.
The entire operation is being revamped. The old CHT website featured $160,000 homes as affordable housing; today the number might go as low as $50,000. "The site was antiquated and out-of-date," said McKitterick. "Things have changed so much. We hope to have the site redone in the next month."
The concept of rehabilitating an existing home – with some "green" touches – wasn’t even on the table before. Now it is the fundamental idea.
"The $7.1 million includes rehabilitation and help for people to qualify [for loans]. Every sale will plow money back into the system," said McKitterick. "Over the next four years, we expect 60 to 65 homes to start, but that will expand as money comes back from sales."
One aspect of the CHT remains the same. The trust will have an ongoing financial stake in the property through ownership of the land or with a shared-appreciation mortgage.
Visits to foreclosed homes have proved an eye-opener. "All the attractive stuff is getting snapped up immediately," said McKitterick.
"Most of the properties need quite a bit of repair."
"Now is just as valuable a time for the CHT as four or five years ago," she said. Commissioner Shannon Staub agreed. "We will have affordable housing problems again in the next five years," said Staub.