July 22, 2006
The July 8-11, 2006, Park Record contained an article concerning Park City’s efforts to encourage the development of affordable housing. As a part time Park City resident, and someone who has spent his career financing, developing and promoting affordable housing across the country, the statement of the city was particularly encouraging.
In a past career with the former USDA Farmers Home Administration, I administrated the agency’s affordable, rental-housing preservation efforts. With the efforts of many individuals and agencies — local, state and federal – we were able to preserve Holiday Village and Parkside Apartments for long-term affordability. At the time, the funds to preserve the properties were the single largest advances made by the agency for preservation purposes. I am happy to see that the properties are still serving their much-needed purpose.
In my current career overseeing affordable rental housing development for the Volunteers of America, the largest nonprofit provider of quality affordable rental housing in the country, I see challenges in developing and preserving housing across the county similar to what Park City faces. Affordable rental housing challenges come primarily in two forms – communities with escalating real estate values that drive up the cost of land, buildings and rents, and communities with low income and low real estate values where housing stock is deteriorating. Each present different issues, but Park City is obviously in the former category.
When real estate values rapidly climb, land and resale building prices become prohibitively expensive. Development of affordable rental housing depends on a combination of the price of the land and buildings, whether new construction or acquisition with rehabilitation, and the cost of operating. If any one of these costs is high, it is often impossible to develop and operate at a level where rents can be held low enough to serve those employed in the service industries or elderly on social security. Affordable housing developers such as Volunteers of America use a combination of subsidies such as the Low Income Housing Tax Credit, Utah Olene Walker Trust funds, foundation grants, and other soft financing from sources such as the Federal Home Loan Banks to assist in the capital financing of the apartments. Many local communities add to these sources through trust funds that may be funded from real estate transfer taxes, direct city subsidies or affordability assessments made against new real estate developments being planned in the community. I am encouraged to see that Park City promotes a number of these sources.
Unfortunately, even when there are adequate sources for financing affordable rental housing, the one thing that seems to be lacking is the land, or availability of existing housing stock or buildings that can be purchased and renovated into affordable housing. While it may be difficult to compare Park City to San Francisco, Los Angeles or New York City, the problem of available land or affordable conversion properties is just as acute. I see the greatest challenge in developing affordable housing in Park City to be land.
The city, employers and residents need to understand the benefits that affordable housing located in the greater Park City area provide – greater economic and social diversity, safe, affordable housing for families and a ready labor source located near employment. To accomplish this goal, the city, employers and concerned citizens need to continue to work together to identify and make available suitable land and buildings for those who can produce and operate the housing. I applaud the city’s statement and focus on providing affordable housing. I challenge employers and concerned citizens to join this effort with the same zeal that I see focused on other social efforts within the community.
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I welcome comments and questions concerning my views. I can be reached via e-mail at firstname.lastname@example.org .