16 things DC (and other cities) could do about housing in a downturn

Nobody knows yet how deep the economic recession or depression caused by COVID-19 will go, but it’s sure to worsen the existing difficulties many people and families already have with where they live. Governments, including the District, have the window of opportunity that comes with disaster to implement policies that could make housing more manageable for more people. Here are a few ideas.

Just as we began to quarantine, I asked on Twitter, “What can we do about housing in a downturn?”. People, including some of our readers, provided a ton of really interesting ideas.

Housing was in the zeitgeist before coronavirus hit, because the longstanding problems around it — that it’s too expensive for too many people, and that where housing that people can afford is located often drives existing inequities — have only intensified.

A new report from the Urban Institute, on who’s affected by Covid-19, says:

More than one-third of area households with people working in COVID-19-affected industries were housing cost burdened, meaning they spent 30 percent or more of their income on housing. One in 7 (15 percent) were severely cost burdened, meaning they spent half their income or more. Black, Latino, and Asian workers were more likely to have housing cost burdens than non-Latino white workers in these same industries.

The potential loss of income from earnings in COVID-19-affected industries could dramatically worsen the situation for these workers and their families. If all these earnings were lost, nearly every household with a worker in a COVID-19-affected industry could be cost burdened, with the share increasing to as high as 61 percent.

Our current crisis is much more of a labor crisis than a real-estate crisis. But the two go together, and break down along the same unequal lines as everything else. Everyone is getting squeezed further now, and what a recovery might look like is unclear. Will what comes to pass match the scale of harm wrought by a stalled economy or the meekly extend our already-insufficient public-policy approaches to housing production and preservation?

Here are some suggestions for things that the District or other cities and counties could do with regard to housing, right now and throughout recovery planning. Some of these things could be carried out immediately. Some would require a shift in how people think about housing, and how we treat it politically. Some ideas apply regionally or nationally, and some are specific to DC or the Washington region. Some use DC-specific terms for programs, but other localities have analogues.

Housing and land-use policy have lasting impacts on how the built environment works. Even mere rhetoric around them functions on a longer timescale than the immediate response required in a crisis moment, to say nothing of plans and laws, which stay on the books for decades. As municipalities design reopenings and recoveries, they should be proactive, not reactive.

Policies that produce more homes

Stay the course on housing targets — in fact, increase them: DC mayor Muriel Bowser has set a goal of building 36,000 units of new units of housing, a third of which would be affordable, by 2025. This tracks with regional housing-production targets adopted by the Metropolitan Washington Council of Governments last year. But both the market rate and subsidized affordable targets really should be higher. The need for housing isn’t going anywhere, and a target is the first step toward actually making a build-housing-as-stimulus policy work.

Consider countercyclical financing: Obviously, the District is, uh, no longer in a boom time. But we’re going to approach an upswing again, and we should plan now for what to do with that. The Bay City Beacon suggested something like this for California last year:

Instead, California could create a “rainy day fund” for affordable housing, similar to the reserve funding currently used to cover impending budget deficits. Each year, California could tax and set aside money to be used in the event of recession. Upon a legally-defined trigger—say [X]% increase in construction unemployment and two quarters of declining building permits—all affordable housing projects applying for the Low Income Housing Tax Credit (LIHTC) program would become eligible for grants from the countercyclical fund.

This would enable shovel-ready projects to break ground right away. Otherwise, projects would have to wait months, even years to get permitted and start to receive grants. New projects could assemble land and entitlements during recession to build during recovery, maximizing public subsidies with lower costs.

Legalize and expedite housing that meets local priorities: Affordable housing, senior housing, whatever it is — market-rate fourplexes, sixplexes, anything that is deemed valuable to achieving a city’s already-established goals — could be legalized citywide and approvals to build it could be expedited. In DC, the mayor’s 36,000-unit goal has emphasized any new housing, though affordable senior housing and permanent supportive housing are frequently cited as specifically desirable.

Existing affordable-housing projects could be approved now; future projects could move up in the queue if they’ve got more affordable housing. Further, we could limit public input on such preapproved projects, since, in this scenario, they meet already-established standards. While public input can improve a project, it can also move projects away from their initial objectives, since public input is generally offered by a relatively small number of people who will not reside in new projects themselves.

This sort of couches, yes, “eliminate single-family zoning designations.” However, to actually do that is a long-term project outside of the scope of a recovery plan. DC would need to rewrite its zoning code again and, even before that, increase the density allowed by the Future Land Use Map, the part of the Comprehensive Plan that shows how dense parts of the city are allowed to be in the future (we’ve suggested making the baseline of the FLUM moderate density).

But a recovery is an emergency, and if DC needs more housing for vulnerable residents in the short term, we might consider the quick construction of both already planned and temporary housing while continuing to pursue longer-term fixes.

Start a massive job-training program for construction trades: Original housing policies in the US, including the creation of the Federal Housing Administration and the construction of public housing, were designed not only to house people but to solve Great Depression-era unemployment. Somebody needs to build the homes that DC has said it needs, but there’s a documented shortage of skilled laborers. Creating a robust pipeline for construction-trade jobs would meet the needs of some unemployed workers and enable builders to get to work.

Kickstart accessory apartments: Accessory Dwelling Units are basement apartments and alley dwellings. ADUs were legalized citywide (except for Georgetown) by the 2016 zoning code. Though they can provide an income stream for homeowners, they’re not as prevalent as they could be, because they’re expensive to plan, permit, design, and build. Municipalities could provide public subsidies for them, and drop any owner-occupancy requirements.

Don’t let up on the focus on wealthy, exclusive neighborhoods: Just as important as housing targets is where that housing goes. All of the above suggestions can either make housing more fairly distributed geographically, or can concentrate poverty in already low-income areas — in DC, that’s the city’s eastern side, while areas like 16th Street Heights, Chevy Chase, Tenleytown, and Capitol Hill are off the hook for contributing to a critical public need.

DC’s Office of Planning is already orienting its suggestions for housing production around adding housing in places that have historically built little of it, especially little affordable housing. That’s even more important now.

Policies that protect people

Put a moratorium on evictions and foreclosures: Many legislatures, including the DC Council, have passed legislation doing this, to a degree. Per DCist, “Foreclosures and new court filings for evictions will be put on hold not only during the state of emergency — but for 60 days after it ends.”

Relieve rents and mortgages: The ideal might be to fully cancel rents and mortgages, but the mechanisms and funding to do so don’t exist at the local level. Barring that, relieve payments to the extent possible, and don’t make people pay it all up after temporary relief ends.

Incentivize good behavior from smaller landlords in exchange for limited rent increases (along with halting foreclosures and evictions, the DC Council also required landlords to offer payment plans to tenants who are facing pandemic-driven financial hardship). The burden of proof should also be on landlords, not tenants, to demonstrate that they need financial relief.

Budget for an increase in assistance for low-income renters: DC Mayor Muriel Bowser’s budget drops funding for the Housing Production Trust Fund, the primary mechanism by which DC subsidizes affordable housing, from $116 million in 2020 to $100 million in 2021. But there’s also DC’s Low-Income Rent Supplement Program (LRSP), the local housing voucher program, which gives low-income District residents money for housing directly.

“The right to stay put” is more easily enabled by getting more money to people who don’t have enough to afford the housing that already exists than by subsidizing new affordable housing: LRSP subsidizes tenants rather than the physical building. It’s really, really expensive to build affordable housing, so giving people money directly for their rent closes a lot of gaps, both in project financing and in people’s lives.

Public funds for housing are often pitted against each other, and they shouldn’t be. LRSP is used in combination with federal housing choice vouchers and with Housing Production Trust Fund subsidies. Fortunately, the mayor’s proposed 2021 budget has used the District’s reserves to maintain programs instead of zeroing them out. But there are still cuts to most line items, including LRSP, has dropped $2,058,000 to $30,516,000.

LRSP cuts constrain the amount of money that we give District residents, who make under 30 percent AMI, for housing. But lots of residents who make under 30 percent AMI aren’t receiving LRSP vouchers, because they aren’t living in a development funded by LRSP, or served by an organization that administers it. So, all that said, the physics of LRSP apply especially during coronavirus: It’s more cost-effective to give people for housing directly than it is to subsidize the buildings themselves. In an emergency, we shouldn’t cut the thing that enables the latter, and we should expand it beyond certain projects.

Preserve what we’ve got

Weaponize the District Opportunity to Purchase Act: DOPA “requires rental property owners to provide the District of Columbia with the opportunity to purchase housing accommodations consisting of five or more rental units, as long as 25 percent or more of those rental units are deemed as ‘affordable.’” The District could go absolutely buck-wild with this and expand its reach to purchase literally anything that’s available for sale if property values, and demand, shrink — land, market-rate buildings, hotels, whatever.

With what money? Come on, now. This is a fantasy list. But this would be worth spending federal funds on acquiring land, if we receive them, or biting the sticker price and immediately ground-leasing land to private entities in return for them building more affordable housing, or more public-health facilities, on it. The math for the latter scenario starts to work a bit better when the land is effectively free, since the cost of land is the primary factor in the high cost of housing. If the District is serious about providing lots of housing, it should increase allowable density as greatly as possible, right now, especially on publicly owned parcels, as described above.

Then, bump up the affordable-housing production requirements for public land: Once the District has acquired a whole bunch of property, it can either hold onto it and lease the land to developers in the future, or it can sell it off. DC already requires that 30% of housing built through public land dispositions be affordable. When stuff’s good again, the city could increase that requirement to 40 or 50%.

Inventory existing resources: The District doesn’t don’t have a clean, easy-to-access database of publicly owned land, rent-controlled units, or even existing housing units, which makes it hard to believe that the city would manage those assets well if they were publicly owned. (It also allows people to claim that there are lots of empty “luxury” units, which is not a useful or productive argument.)

The District, ostensibly, already owns lots of land, but if I tell you that, I can’t tell you how I know that, other than that…other people have told me that, and I guess I believe them. This is not great, and it makes it hard to argue for, say, a better production pipeline based on public land ownership.

Reorient resources to co-ops and community land trusts: DOPA, weaponized, will — optimistically — result in the unprecedented accrual of land that’s then held by the public sector, which is a basic requirement for a CLT. While we’re weaponizing, the mayor or the council could consider restoring the Tenant Opportunity to Purchase Act to apply to single-family houses, something they cut in 2018.

Transit policy is housing policy is land use policy

Give transit agencies money: to, uh, run transit!

End parking requirements: They make housing more expensive. Stop it.

Install a whole bunch of bus and bike lanes: Do it right now, while people aren’t driving. It’ll be easier to eliminate parking requirements if people see a tangible investment in other modes. It took a while, but Mayor Bowser has given DDOT the go-ahead to widen sidewalks. There’s no reason that the same rapid response isn’t being granted to transit.

This is by no means an exhaustive list. There’s a lot that isn’t possible unless the federal government leads on it or pays for it: giving people money, incentivizing land-use reform, funding affordable housing, and funding the restoration of public housing.

While it would be lovely to use this breakdown in normalcy to completely reevaluate how we fund, construct, and where we build housing, a rigorous analysis of local programs is probably not available at this time. However, steps like acquiring lots of land, eliminating the exclusionary zoning laws that protects wealthy neighborhoods from anything denser than a single-family home, and an approvals process that not just enables, but incentivizes, projects that have higher numbers of affordable units, would do a great deal to set up better public practices around housing production and preservation in the future.

Urban’s report also notes that, “Before the crisis, Urban Institute research documented the challenges the region faced in meeting the population’s affordable housing needs. The income put at risk by the ongoing economic downturn only exacerbates that situation, further challenging the region’s ability to preserve and produce enough affordable housing and protect vulnerable renters and homeowners.”

I wrote about that documentation, Urban’s September 2019 report, “Meeting the Washington Region’s Future Housing Needs,” which became the basis for MWCOG’s adoption of regional housing targets, extensively, and hope that my writing now makes the same point: Everything that was relevant, of concern, and on people’s minds six months ago with regard to housing is doubly important so now.