Here’s how Mayor Parker plans to spend $800 million on housing
“We have a housing crisis,” Parker’s chief of staff says. The administration has set seven priorities to try to solve it.
Mayor Cherelle L. Parker revealed the specifics of her $800 million housing policy Monday, detailing how she hopes to spend money raised by city bonds to build or repair 30,000 homes.
The mayor presented an overview of her “Housing Opportunities Made Easy," or H.O.M.E. initiative, to City Council in March, but this is the first time her spending priorities have been made public.
“This represents the most ambitious housing plan in the city’s recent history,” said Angela Brooks, Philadelphia’s chief housing and urban development officer. “It’s tackling housing from every angle.”
The bond money would be spread across 38 programs, although the majority would go to a handful of policies.
Over $600 million would be split between seven initiatives, which are largely existing programs the administration wants to expand.
$161 million for affordable-housing preservation. Many federal housing programs such as the Low Income Housing Tax Credit are public-private partnerships that rely on expiring subsidies. Sometimes owners seek to redevelop their property to a new use and displace residents, as occurred at the University City Townhomes. H.O.M.E would boost existing funds that are used to extend the life of affordable contracts or to repair older buildings to ensure units are not lost to neglect. Goal: 4,000+ households
$112 million for Turn the Key, which gives developers essentially free city-owned land to build for-sale housing. The program is available to first-time buyers making less than 100% of area median income (AMI), or $83,600 for a one-person household or $119,000 for a family of four. The city provides a secondary mortgage with a deferred payment schedule, delaying some costs for the owner unless or until they sell the home. The new funds will also help finish some of the over 800 units in the development pipeline now. Goal: at least 280 new households, plus wrapping up the current backlog
$84 million for the Basic Systems Repair Program (BSRP). This long-standing city policy helps lower-income homeowners fix up their houses, a popular goal in a city with an aged housing stock and a high rate of home ownership among working-class and poor residents. Currently the program repairs 2,500 homes a year, with a substantial waitlist. Parker proposes extending BSRP to those making 100% of area median income. “There’s a significant constituency that’s going to be able to benefit from that,” said Jessie Lawrence, director of planning and development chief. “Just because you’re over 60% of AMI doesn’t mean that you don’t need relief.” Goal: 7,500 homes
$79.5 million for affordable-housing production. Most subsidized-housing programs have to stitch together their budget from a variety of sources. This would expand the existing source of local funds to projects with an affordable component. “There is some dependency on federal subsidies, and we want to provide some alternative,” said Lawrence. Goal: 1,500 new units
$70 million for one-time payments for back rent. Philadelphia created a suite of nationally lauded policies to cut down on evictions during the COVID-19 pandemic, many of which would be expanded under the mayor’s H.O.M.E proposal. The largest infusion of new money to anti-eviction work would cover one-time payments to landlords to cover the rent backlog for a tenant, if both parties agree to participate in the Eviction Diversion Program. This provides renters and owners a meditated forum to hash out their differences and keep tenants in their homes. It has helped the city’s eviction filings drop dramatically. Goal: 11,000 households served
$50.7 million to One Philly Mortgage, which aims to provide 30-year fixed-rate loans to households up to 120% area median income. (That’s over $100,000 for a household of one or over $143,000 for a household of four). This is the largest funding allocation for a new program, and it’s aimed at first-time homeowners who might not qualify for conventional loans. Goal: 3,000 households
$50 million to expand the Philly First Home program. This is another first-time homeowner-assistance program that covers down payment and loan closing costs for mortgages up to $250,000. The grants go up to $10,000 or 6% of the purchase price, whichever is lower. Those who make less than 100% of AMI qualify. Goal: 4,000 households
Over two dozen other programs will be funded, including a rental-subsidy program, alleyway maintenance, homelessness prevention, and a program to help people with disabilities adapt their homes.
The documents the administration presented to Council estimate that Philadelphia has a 17,000-unit shortage in “undersupplied” areas, which see little unsubsidized development.
In areas where market-rate development has been concentrated, a temporary glut has left some buildings with high vacancy rates. The administration wants to allocate $2 million to a property-based subsidy that would allow lower-income and middle-class residents to rent units in higher-income buildings with vacancies.
“We are really trying to address the crisis in the whole housing continuum, not just one sector or one income bracket,” Brooks said.
The administration’s calculus shows that 27,000 of the 30,000 units they hope to build or preserve would be targeted to those making less than $100,000 a year. Only 300 of their estimated units would be “market rate,” which they characterize as over 120% of AMI.
As President Donald Trump’s administration prepares sweeping cuts to affordable-housing programs, Parker could come under pressure to allocate more funds to the lowest-income households.
Parker has long been adamant that she is committed to also aiding households that do not live in poverty by official measurements but are still struggling.
“We’re not going to pit the have-nots against the have-just-a-little-bits,” said Tiffany W. Thurman, Parker’s chief of staff. “We have a housing crisis, and it’s impacting all of us. We’re not going to just focus on one group.”