The Borough's Burden, Part 4

The Bright Hope public housing complex on Pottstown's west side, formerly called Penn Village, is operated by the Montgomery County Housing Authority and represents one way low-income housing is concentrated in Pottstown and other older traditional towns.

What Role Does Public Housing Play?

This is the $64,000 question in Pottstown.

We should begin by understanding that not all of this high concentration low-income housing can be laid at the feet of public housing, whether it be in the form of Section 8 Housing or public housing projects like Bright Hope.

Mercury Photo by Kevin Hoffman

Montgomery County Commissioners Chairman Josh Shapiro,

left, addresses the Pottstown crowd last month. At right are

commissioners Bruce Castor and Leslie Richards.

When the Montgomery County Commissioners visited Pottstown last month, Commissioners Chairman Josh Shapiro pointed out that Pottstown has a lower concentration of Section 8 vouchers than is often proclaimed.

I have no reason to doubt that information.

But not all low-income housing is public housing and what he could NOT deny, and which the Delaware Valley Regional Planning Commission study we began examining yesterday and will continue to draw from today confirms, is that public or not, there IS a concentration of poor and low-income housing here in Pottstown.

And the burden that Pottstown bears from that concentration is equally heavy, whether that low-income housing comes from a public source or not.

Photo by Evan Brandt

Joel Johnson, the executive director of the Montgomery

County Housing Authority also spoke at that Pottstown meeting.

When the police are called to a low-income home for a domestic, a drug call or other disturbance that so often accompanies such households, it costs taxpayers the same, whether their rent is paid through public vouchers or not.

When a child from Bright Hope needs an IEP from the school district and a specialized one-on-one aid to give him or her the best leg up on keeping up with their education, it costs taxpayers the same whether their rent is paid through public vouchers or not.

And when we complain to public officials about Section 8, it is only because that portion of the low-income housing burden is the only portion we can hope to directly affect by appealing to those public officials who are answerable to us and can, hopefully, do something about it.

OK, so enough preaching from the mount.

Back to some more facts from the DVRPC report, "The Mismatch Between Housing and Jobs," issued in 2011.

For those of you who haven't been following along, we began working through this report in yesterday's post and today are posting the sections I pulled out of that report that contain numbers, facts and assumptions about how the region handles publicly assisted housing.

As with yesterday's post, what appears below was taken directly from the report, but is not necessarily posted in the same order as the report. Anything in bold is my own emphasis or additional comment.

The Montgomery County Housing Authority operates 615 housing units; the Bucks County Housing Authority operates 742 housing units; and the Chester County Housing Authority operates 331 public housing units. 

There are 331 public housing units in Chester County, managed by the Chester County Housing Authority. These are located in the City of Coatesville, Phoenixville Borough, Oxford Borough, South Coatesville, and West Chester Borough. Almost 1,600 assisted housing units are also located in the county, all within 14 municipalities located primarily along the Route 30 and Route 322 corridors. 

In Montgomery County, 615 public rental units are managed by the Montgomery County Housing Authority. Public housing units are concentrated within six municipalities in the county, three of which are older boroughs along the Schuylkill River (the Boroughs of Conshohocken, Royersford, and Pottstown) and two of which are well-developed suburban townships (Upper Moreland and Upper Dublin). An additional 3,500 subsidized units are located throughout the county. 

Between 2009 and 2010 approximately 53,650 Housing Choice Vouchers (the new name for Section 8 ) were allocated in Greater Philadelphia. The rationale behind the Housing Voucher Choice Program is to give low-income families an opportunity to move to moderate and median-income areas where they can better access jobs and secure a better education for their children. 

The five southeastern Pennsylvania counties are allotted 26,209 certificates and vouchers (49 percent of the region’s total). Housing Choice Vouchers and certificates are also administered by the other five Pennsylvania housing authorities of the City of Chester (1,586), Bucks County (3,398), Chester County (1,521), Delaware County (3,086), and Montgomery County (1,480).  

Public Housing in Montgomery County:
Pottstown -- 632 units
Norristown -- 546
Lansdale: -- 647 

Public Housing in Chester County"
Coatesville – 510
Phoenixville – 107
Spring City -- 190 

The most common perception and concern of those opposed to affordable residential development in their communities is that the presence of subsidized housing or tenants with rental assistance leads to declining property value.

Several studies, however, conclude that the impact of federally subsidized housing on nearby property values is not always negative, but varies by type of unit and by type of community.

One study that reviewed the impacts of subsidized housing in New York City, for example, found that units subsidized under the federal Section 202 program (housing for the elderly) or constructed using Low Income Housing Tax Credits (LIHTC) had a positive impact on property values that then remained stable over time.

For Section 8 and public housing, the same study found that the impact on property values was relatively minor for smaller scale projects and that any negative impact on values typically occurred within the first three years after project completion and then dissipated.

Another study noted that affordable housing developments that replace vacant, abandoned, or otherwise blighted conditions generate positive impacts on surrounding properties, and stressed that good management and housing maintenance is critical to sustaining property values.

Good property maintenance (of both affordable and market rate developments) and proactive property code enforcement are key to maintaining neighborhoods. Units subsidized under the Housing Voucher Choice program are inspected annually and landlords must agree to correct any deficiencies within a limited time in order to continue to receive their subsidy.

Housing advocates note that this requirement (if properly enforced) can result in a Section 8 rental unit being better maintained than another unit rented through an absentee landlord in the same neighborhood without a subsidy.

Some studies do suggest, however, that there is some threshold (in terms of either number of units or scale of the project) where an over-concentration of subsidized units in one community, particularly of tenant-based subsidies, may result in stagnant or declining property values. This threshold is difficult to define and most likely varies by community, depending on the existing characteristics of both the neighborhood and the tenants.

Past and current housing policies that concentrate affordable housing assistance in distressed communities, although well-intended, have unintentionally contributed to suburban sprawl and contributed to disinvestment in cities and older suburbs.

Public housing residents pay 30 percent of their monthly income toward the rent and the federal operating subsidy makes up the remaining difference. The operating subsidy funding received each fiscal year is often not sufficient to cover actual operating costs, which can lead to poor maintenance of public housing units.

The Section 8 program, now referred to as the Housing Choice Voucher Program, assists low-income households, defined as those earning 50 percent or less of the median income.

Housing vouchers may be used for any unit where the owner agrees to participate and where the unit satisfies the standards set by the local housing authority (This puts the responsibility for maintenance and standards squarely in the lap, in Pottstown's case, of the Montgomery County Housing Authority.) 

Under the current program guidelines, HUD pays the difference between what a low-income family can afford to pay towards their rent (defined as 30 percent of their adjusted income or 10 percent of their gross income, whichever is higher) and an approved fair market rent for an adequate housing unit. Landlords who agree to participate in the program are required to allow the housing authority to inspect the unit annually.

Although the intent of the Housing Choice Voucher program is to enable low-income tenants to use the subsidy for a unit in a location of their choice, the Fair Market Rent limit realistically encourages their use primarily in places with the lowest housing costs (including cities, boroughs, and older suburbs).

Counties and local jurisdictions that receive Community Development Block Grants, HOME , and other types of federal funds are required to comply with the federal Fair Housing Act and the requirements of the Community Development Act.

Which brings us back to this. Does THIS look like fair housing choice?

These regulations require that the county or municipality affirmatively further fair housing to the maximum extent possible. Under these requirements, every jurisdiction receiving federal community development funding must (1) conduct an analysis of impediments to fair housing choice; (2) take appropriate actions to overcome the effects of impediments identified through that analysis; and (3) maintain records reflecting actions they’ve taken and their accomplishments to date.

A 2009 court decision involving Westchester County, New York, emphasized the seriousness of fulfilling this requirement.

In February 2009 a federal judge ruled that Westchester County had failed to conduct an adequate analysis of impediments and had taken no steps whatsoever to further fair housing while continuing to receive HUD funding, despite clear racial segregation throughout their communities. In July 2011, after repeatedly rejecting revised analyses of impediments submitted by the County, HUD stopped providing community development funds to the County and is currently pursuing additional action, including the possible restitution of previously awarded funding.

Low Income Housing Tax Credit

The Tax Reform Act of 1986 established the LIHTC to encourage the construction and rehabilitation of rental housing for low income persons. LIHTC accounts for nearly 90 percent of all affordable rental housing created in the United States today. 

Photo by Kevin Hoffman

Mary Beth Lydon, now Mary Beth Bacallao, protested the 

proposed senior housing project in 2010. She is now a 

member of the Pottstown School Board.

(Some may recall, this was the program that, in 2010, was going to be used to construct the low-income senior housing project along Industrial Avenue, a project which was considered controversial and was ultimately denied by the state, even though borough council voted to support it.) 

The tax credit is available to owners of and investors in rental housing for up to 10 years as a dollar-for-dollar reduction of federal tax income liability, provided that the rental housing project remains in compliance with occupancy and rent requirements for a 15-year compliance period.

The LIHTC program is one of the largest funding sources available to local Community Development Corporations (CDCs) for the development and rehabilitation of affordable rental housing. 

Most states (including New Jersey and Pennsylvania) usually allocate low-income housing credits to cities and older suburbs. This policy is well-intended but has played a role in creating concentrations of poverty, encouraging suburban sprawl, and exacerbating the mismatch between these older areas and their surrounding growing suburbs.

In general, Pennsylvania has not been proactive in requiring municipalities to provide affordable housing for low and moderate income families. One exception is the 1975 case of Township of Willistown v. Chesterdale Farms (341 A. 2d 46), in which the Pennsylvania courts ruled that the local zoning ordinance was exclusionary because it did not allow any acreage for apartment construction and thus excluded a lower-income population which could rent but not purchase.

Improving the financial status and quality of life in the region’s cities and older suburbs requires revisions to the current property tax structure as well as housing policies and programs.

The Southern California Association of Governments (SCAG) released a report in 2001, The New Economy and Jobs/Housing Balance in Southern California, which found that balancing housing and jobs in a defined geography has numerous environmental benefits, lowers infrastructure costs, and improves family stability. 

The same study found that an excess amount of the region’s vacant land had been zoned for commercial and industrial purposes relative to their forecasted housing needs for the Year 2025, which would undoubtedly exacerbate the mismatch.

By providing an analysis of zoned land for future uses, local governments can plan for the appropriate number and type of housing units in proximity to existing and future employment centers.

A new approach is needed, one that recognizes that public policies and funding streams can catalyze a more balanced and sustainable approach to housing that will benefit older and newer communities, workers and employers, and the region as a whole.

Tomorrow, we will conclude with a look at the recommendations made in this report for ALL levels of government.

Until then, thanks for sticking with me on this...